3. A) Use marginal benefits and marginal cost curves to explain how many FBI agents the government should hire.Show how a terrorist threat will shift the marginal benefit curve and alter the government's decision on how many agents to hire?Show graphically.

B) Anne has 8 hours a week to allocate between sewing and knitting.Each activity takes one hour and the number of utils she receives from each hour appears below.

Utils fromUtils from

HourSewing Knitting

12710

2249

3218

4187

5156

6125

794

863

b.1) How many times would she do each activity?Explain your reasoning.

b.2) Using the information below, draw a graph indicating the marginal benefits and marginal costs for sewing.

b.3) Are the two activities ever equally appealing?If so, when?