(Transcript of audio with descriptions. Transcript includes narrator headings and description headings of the visual content)
(Speaker)
In this question, you were asked to find the optimal number of security guards the residents would hire if they acted together.
(Description)
The table from previous slide is shown.
The following text is written above the table:
If the residents act together, how many security guards will they hire?
(Speaker)
For this question, we want to compare the marginal social benefit with the marginal cost of hiring each security guard. Since the marginal cost of hiring each security guard is 150 dollars, we want to hire security guards up to the point where the marginal social benefit exceeds the marginal cost.
They will therefore decide to hire three security guards. For the third security guard, the marginal social benefit of 200 dollars exceeds the marginal cost of 150 dollars.
(Description)
The cells in the fourth row, Marginal cost is, 150, and, Marginal social benefit is, 200, are labeled as They will hire 3 security guards, for this is the last point where the marginal social benefit is greater than (or equal to) the marginal cost.
(Speaker)
But for the fourth security guard, the marginal cost of 150 dollars would exceed the marginal social benefit of 100 dollars.