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Question 223

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Scenario: Alexander and Vanessa
Alexander and Vanessa benefit from scientific research. Alexander's marginal private benefit from such research is given by the equation P = 200 - Q, where Q refers to the amount of research undertaken and P is the price Alexander is willing to pay for such research. Vanessa's marginal private benefit from such research is given by the equation P = 100 - Q. The marginal social cost of engaging in such research is constant at $100.
-(Scenario: Alexander and Vanessa) Refer to the scenario Alexander and Vanessa. If Alexander and Vanessa are the only two individuals in a society, which of the following equations correctly represents the marginal social benefit (MSB) of scientific research?


A) MSB = 300 - 2Q.
B) MSB = 100 - Q.
C) MSB = 200 - Q.
D) MSB = 100.

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