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Suppose That the Marginal Benefit of Having a Security Camera

Question 48

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Suppose that the marginal benefit of having a security camera in the library is given by MB,at the supermarket is given by MB1 and at the museum is given by MB2.All values are per week. Suppose that the marginal benefit of having a security camera in the library is given by MB,at the supermarket is given by MB<sub>1</sub> and at the museum is given by MB<sub>2</sub>.All values are per week.   Suppose cameras are currently allocated efficiently.Now suppose that a camera at the museum malfunctioned and it will take two weeks to replace it.Owners of the supermarket would A) be willing to rent the museum a camera for less than the value of the camera to the museum. B) not be willing to rent the museum a camera for less than the value of the camera to the museum,but managers at the library would. C) not be willing to rent the museum a camera for less than the value of the camera to the museum,and neither would managers at the library. D) exploit the situation by renting a camera to the museum for more than $U per week.
Suppose cameras are currently allocated efficiently.Now suppose that a camera at the museum malfunctioned and it will take two weeks to replace it.Owners of the supermarket would


A) be willing to rent the museum a camera for less than the value of the camera to the museum.
B) not be willing to rent the museum a camera for less than the value of the camera to the museum,but managers at the library would.
C) not be willing to rent the museum a camera for less than the value of the camera to the museum,and neither would managers at the library.
D) exploit the situation by renting a camera to the museum for more than $U per week.

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