Answer the Question on the Basis of the Following Table

question 95

Multiple Choice

Answer the question on the basis of the following table that shows the total costs and total benefits facing a city of five different potential baseball stadiums of increasing size. All figures are in millions of dollars. The marginal cost and marginal benefit of stadium B (relative to A) are

• A) $20 million and $50 million, respectively.
• B) $100 million and $200 million, respectively.
• C) $30 million and $50 million, respectively.
• D) $20 million and $60 million, respectively.

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Definitions:

Normal Good

A good for which demand increases as consumer income rises, holding everything else constant.

Utility Function

A mathematical representation used in economics to show how different bundles of goods or services contribute to an individual's overall satisfaction or happiness.

Apples

Commonly a term for the fruit, but in economic or mathematical contexts, it may serve as a generic placeholder for any tradable good.

Bananas

A tropical fruit characterized by its elongated shape, yellow skin when ripe, and soft, sweet flesh.