Using the figure above,suppose there are two political parties,the Hawks and the Doves,which agree on all issues except for the quantity of defense satellites.The Hawks want 300 satellites and the Doves want 100 satellites.The voters are well informed and know what is best for them.The parties run a voter survey and discover the marginal benefit curve (MB).They also know the marginal cost curve (MC).What quantity of satellites will most likely result from this political process?
A) 200, because unless each party proposes 200 satellites, the other party can beat it in an election
B) 300, because the Hawks are more likely to win
C) 100, because the Doves are more likely to win
D) 200, because the parties will strike a deal: each will agree to give up 100 satellites
E) Zero, because given the marginal benefit and the marginal cost of satellites, none should be provided.

Question

Quizplus · Accepted Answer

In a well-informed electorate where voters know what is best for them, political parties will aim to propose policies that maximize the net benefit to society, which is where the marginal benefit (MB) equals the marginal cost (MC). Assuming the MB curve reflects the voters' preferences accurately, the quantity of satellites that maximizes net benefit would likely be at the point where MB equals MC. Without specific details on the MB and MC curves, the most rational compromise between the two parties' preferences (300 for Hawks and 100 for Doves) would be the middle ground, which is 200 satellites. This position would likely garner the most voter support, as it represents a compromise that still aims to maximize societal welfare based on the given preferences.

Using the Figure Above,suppose There Are Two Political Parties,the Hawks