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The following data are for a series of increasingly extensive flood control projects:
Total cost Total benefit per year per year
Plan A levees $10,000 $16,000
Plan B small reservoir 24,000 36,000
Plan C medium reservoir 44,000 52,000
Plan D large reservoir 72,000 64,000
Refer to the data. For Plan D marginal costs and marginal benefits are:_______. a. $72,000 and $64,000 respectively.b. $28,000 and $12,000 respectively .c. $24,000 and $18,000 respectively.d. $16,000 and $28,000 respectively.

Respuesta :

Answer:

b. $28,000 and $12,000 respectively

Explanation:

The computation of the marginal cost and the marginal benefits for Plan D is shown below:

Marginal cost = Total cost for Plan D per year  - Total cost for Plan C per year

= $72,000 - $44,000

= $28,000

Marginal benefit = Total benefit for Plan D per year - Total benefit for Plan C per year

= $64,000 - $52,000

= $12,000

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