Question

The marginal benefits of wildlife habitat preservation in a society with just two individuals, Katya and Miguel, are given in the table below.

What policy below would achieve the efficient provision of wildlife habitat?

Acres of wildlife habitat	Katya's marginal benefits (dollars)	Miguel's marginal benefits (dollars)
1	50	30
2	40	25
3	30	20
4	20	15
5	10	10
6	0	5

Answer 1

Answer:

The marginal benefits of wildlife habitat preservation in a society with just two individuals, Katya and Miguel, shows that marginal benefits of Katya equals the marginal benefits of Miguel when 5 acres of wildlife habitat preserved.

Thus the policy of preserving 5 acres of wildlife habitat would achieve the efficient provision of wildlife habitat in the society with Katya and Miguel.