Question
16. Consider a public good and two consumers. Suppose the two marginal benefit curves are downward-sloping, linear, and parallel (i.e. the slopes are equal) but
16. Consider a public good and two consumers. Suppose the two
marginal benefit curves are downward-sloping, linear, and
parallel (i.e. the slopes are equal) but they do not coincide.
Marginal benefit (depicted on the vertical axis) and quantity
(depicted on the horizontal axis) cannot be negative. The
aggregate marginal benefit curve
A. has a kink at an interior point (i.e. a point at which quantity and
marginal benefit are both strictly positive).
B. has a vertical section on the vertical axis.
C. has a horizontal intercept equal to the sum of the two individual
horizontal intercepts.
D. has a vertical intercept equal to the greater of the two individual
vertical intercepts.
E. is a straight downward-sloping line without any kinks.
F. is a rectangular hyperbola.
G. is a quadratic function.
H. coincides entirely with the marginal cost curve.
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