(Table: Externalities from Parks) the Table Externalities from Parks Shows

question 25

Multiple Choice

(Table: Externalities from Parks) The table Externalities from Parks shows the marginal social benefit and the marginal social cost of preserving various amounts of land in a city for a public park.If 1 acre is dedicated to the park, this outcome is _________ because _.

• A)efficient; MSB = MSC
• B)efficient; MSB > MSC
• C)inefficient; MSB > MSC
• D)inefficient; MSB < MSC

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Definitions:

MRP

The additional revenue a firm earns by employing one more unit of input, assuming other inputs remain constant, often used in the context of labor.

Acres

A unit of land area used in the imperial and US customary systems, equivalent to 4,840 square yards or 43,560 square feet.

Rent

Payment made to use or occupy land, a building, machinery, or other assets for a specified period under a lease agreement.

MRP

An abbreviation for Marginal Revenue Product, which is the additional revenue generated from employing one more unit of a factor, such as labor or capital.