-Paul and Paula Are the Only Members of Society

Multiple Choice

-Paul and Paula are the only members of society. The table above gives their marginal benefits from missile gunboats, a public good. Suppose the marginal cost of a missile gunboat is $8 million. What is the efficient quantity of missile gunboats?

A) 3 boats
B) 4 boats
C) 2 boats
D) 1 boat
E) More information about whether the services provided by missile gunboats are rival or not is needed.