The Total Value to Society of Having Garbage Removed Is

question 19

Multiple Choice

The total value to society of having garbage removed is greater than the value of baseball games.Why, then, are baseball players paid more than garbage collectors?

• A)Although the total value of garbage removal is greater than the total value of baseball, wages are determined by average values.
• B)Garbage removal results in significant external benefits that are not captured in the price paid for garbage removal. As a result, wages of garbage collectors do not reflect their social benefits.
• C)There is greater competition in the garbage collection industry than there is in Major League Baseball.
• D)Wages do not depend on total values but marginal values. The marginal revenue product of baseball players exceeds the marginal revenue product of garbage collectors.

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Definitions:

Compounded Monthly

Interest calculation method where interest is added to the principal sum each month, resulting in interest on interest.

12%

A percentage value often used to denote a rate, such as an interest rate or growth rate.

$50,000

A numerical monetary value, often used to indicate a specific amount in financial transactions.

8.4%

A percentage value, which could represent an interest rate, a portion, or a growth rate in various financial contexts.