John is trying to decide how to divide his time between his job as a stocker in the local grocery store,which pays $7 per hour for as many hours as he chooses to work,and cleaning windows for the businesses downtown.He makes $2 for every window he cleans.John is indifferent between the two tasks,and the number of windows he can clean depends on how many hours he spends cleaning in a day,as shown in the table below: $\begin{array} { | l | l | } \hline \begin{array} { l } \text { Cleaning time } \\\text { (hr/day) }\end{array} & \begin{array} { l } \text { Total numbers of } \\\text { windows cleaned }\end{array} \\\hline 0 & 0 \\\hline 1 & 7 \\\hline 2 & 11 \\\hline 3 & 14 \\\hline 4 & 16 \\\hline 5 & 17 \\\hline\end{array}$
Does the 3^rd hour spent cleaning satisfy the cost benefit principle?

Question

John is trying to decide how to divide his time between his job as a stocker in the local grocery store,which pays $7 per hour for as many hours as he chooses to work,and cleaning windows for the businesses downtown.He makes $2 for every window he cleans.John is indifferent between the two tasks,and the number of windows he can clean depends on how many hours he spends cleaning in a day,as shown in the table below:

\begin{array} { | l | l | } \hline \begin{array} { l } \text { Cleaning time } \\\text { (hr/day) }\end{array} & \begin{array} { l } \text { Total numbers of } \\\text { windows cleaned }\end{array} \\\hline 0 & 0 \\\hline 1 & 7 \\\hline 2 & 11 \\\hline 3 & 14 \\\hline 4 & 16 \\\hline 5 & 17 \\\hline\end{array}

Does the 3^rd hour spent cleaning satisfy the cost benefit principle?

Quizplus · Accepted Answer

The cost-benefit principle is satisfied if the additional benefit from an activity exceeds its additional cost. In the 3rd hour, John cleans 14 windows, earning $28 in total. However, the additional windows cleaned from the 2nd to the 3rd hour is 3 (14-11), earning an additional $6. Since he could earn $7 by working an extra hour at the grocery store, the additional $6 from cleaning does not satisfy the cost-benefit principle.

John Is Trying to Decide How to Divide His Time