Four Stores Have a Problem with Theft and Security Is

question 55

Multiple Choice

Four stores have a problem with theft and security is a public good.Let S stand for the number of person-hours of security patrols per week.The marginal benefit of security patrols to each of the stores is given by the formula MB = 200/(1 + S) .Patrols cost $25 per hour.Which of the following gives the marginal social benefit function?

• A) MSB = 50/(1 + S)
• B) MSB = 4 + [200/(1 + S)]
• C) MSB = 800/(1 + S)
• D) MSB = [200/(1 + S)] - 4