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A filtration improvement has been proposed for the old water plant that serves the entire city....

A filtration improvement has been proposed for the old water plant that serves the entire city. Water rates have been only 2 cents per gallon, but with the improvement, the rate would be 5 cents per gallon.

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cost benefit analysis is always done at the marginal level. so for extra marginal cost of 3 cents per gallon, are the marginal benefits worth 3 cents or not.So there are the additional benefits of cleaner water worth paying 3 more cents per gallon.

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