Question

marginal benefits and costs in equilibrium exercise 1 (algo)
emmanuel enjoys growing zucchini in his garden and then selling his produce at the local farmers market. the table below shows his marginal benefit and marginal cost for each hour he spends in his garden per week.
emmanuels marginal benefit and marginal cost of gardening

hours spent gardening	marginal benefit (dollars)	marginal cost (dollars)
2	21	9
3	18	12
4	15	15
5	12	18
6	9	21
7	6	24

a. given the information above, what is emmanuels optimal amount of time spent gardening each week?
○ 3 hours
○ 4 hours
○ 2 hours
○ 5 hours

Explanation:

Step1: Identify equilibrium rule

Optimal time occurs where marginal benefit (MB) equals marginal cost (MC), or MB ≥ MC for the last hour.

Step2: Match MB and MC values

Check each hour:

• 1 hour: $24 > $6
• 2 hours: $21 > $9
• 3 hours: $18 > $12
• 4 hours: $15 = $15
• 5+ hours: MB < MC

Answer:

4 hours