Senator Smith argues that the U.S. should spend another $100 million on healthcare this year in...
Senator Smith argues that the U.S. should spend another $100 million on healthcare this year in addition to the $800 million that we are currently spending. Senator Jones argues that we should not. Which of the following related statements is correct?
A) The extra $100 million spent on health care will not provide as much benefit as the previous $100 million due to diminishing marginal benefit.
B) The extra $100 million spent on health care will necessarily provide no extra benefit due to the problem of diminishing marginal benefit.
C) The extra $100 million spent on health care will decrease the total benefit derived from health care but will increase the marginal benefit.
D) Senator Smith must be a better person than Senator Jones since there can be no rational reason to oppose more health care spending.
Homework Answers
Ans.- (A)
The extra $100 million spent on health care will not provide as much benefit as the previous $100 million due to diminishing marginal benefit.
All of the other statements are false.
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