Price (thousands of dollars) 100 80 60 40 20 5 10 15 MC 20 MB 25 Quantity (police officers) The figure above shows the marginal cost and marginal benefit of police protection in the city of Hugo, Oklahoma. Police protection is a public good. If the city of Hugo hires 25 officers, then OA. marginal cost will exceed marginal benefit, which means that the efficient number of officers is less than 25. B. marginal benefit will exceed marginal cost, which means that Hugo should reduce the number of officers they hire. OC. marginal benefit equals marginal cost. D. marginal cost will exceed marginal benefit, which means that the efficient number of officers is more than 25. OE. None of the above answers is correct. 1 5 $ 54 # 3 R E D MacBook Pro % ^ 5 6 F T Y 27 G H U כ 8 * 00 X C V B N H ed J - < ) 9 -O M K Time Remaining: 00:44:50 Next 40 |- 00 0 L V- P .V 11 + لالي = - ? H r command option } 1
Price (thousands of dollars) 100 80 60 40 20 5 10 15 MC 20 MB 25 Quantity (police officers) The figure above shows the marginal cost and marginal benefit of police protection in the city of Hugo, Oklahoma. Police protection is a public good. If the city of Hugo hires 25 officers, then OA. marginal cost will exceed marginal benefit, which means that the efficient number of officers is less than 25. B. marginal benefit will exceed marginal cost, which means that Hugo should reduce the number of officers they hire. OC. marginal benefit equals marginal cost. D. marginal cost will exceed marginal benefit, which means that the efficient number of officers is more than 25. OE. None of the above answers is correct. 1 5 $ 54 # 3 R E D MacBook Pro % ^ 5 6 F T Y 27 G H U כ 8 * 00 X C V B N H ed J - < ) 9 -O M K Time Remaining: 00:44:50 Next 40 |- 00 0 L V- P .V 11 + لالي = - ? H r command option } 1
Managerial Economics: A Problem Solving Approach
5th Edition
ISBN:9781337106665
Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Chapter19: The Problem Of Adverse Selection
Section: Chapter Questions
Problem 1MC
Related questions
Question
Transcribed Image Text:Price (thousands of dollars)
100
80
60
40
20
5
10
15
MC
20
MB
25
Quantity (police officers)
The figure above shows the marginal cost and marginal benefit of police protection in the city of Hugo, Oklahoma. Police protection is a public good. If the city of Hugo hires 25 officers, then
OA. marginal cost will exceed marginal benefit, which means that the efficient number of officers is less than 25.
B. marginal benefit will exceed marginal cost, which means that Hugo should reduce the number of officers they hire.
OC. marginal benefit equals marginal cost.
D. marginal cost will exceed marginal benefit, which means that the efficient number of officers is more than 25.
OE. None of the above answers is correct.
1
5
$
54
# 3
R
E
D
MacBook Pro
%
^
5
6
F
T
Y
27
G
H
U
כ
8
* 00
X
C
V
B
N
H
ed
J
-
<
)
9
-O
M
K
Time Remaining: 00:44:50
Next
40
|-
00
0
L
V-
P
.V
11 +
لالي
= -
?
H
r
command
option
}
1
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