A legislative committee is weighing the pros and cons of a clean-air program. If it spends $1 million on the program, the air will be cleaner by 20 percent. If it spends $2 million, the air will be cleaner by 30 percent. If it spends $3 million, the air will be cleaner by 35 percent. After comparing opportunity costs and benefits at the margin, the committee agrees to fund the program with $2 million. Why did it not choose to appropriate $3 million? a. At $3 million, the air is not improved as much as the committee would like. b. At $3 million, the costs are no longer worth the benefits. c. It

Question

anonymous · Answer

a. At $3 million, the air is not improved as much as the committee would like.
All the other millions Spent improved air by 10% This on only went up 5%.

anonymous · Answer

I don't see options 3 & 4. It is based on extent decision. Additional 1 million gets only 5%
With just a & b, i'm more inclined to b