Question

Which of the following is CORRECT about a public health intervention of free flu vaccination for homeless families and individuals? [Hint: Perform marginal analysis.] (

a) If the marginal benefit (MB) of the public health interventionis greater than its marginal cost (MC) at a certain program cost, further investment in the flu vaccination program seems to be a good idea at that spending level.

(b) The program should operate at a point where MC slightly exceeds MB.

(c) If MB of the program is $50 and MC is $55 at a certain spending level, the program must be expanded with additional funding at that spending level.

(d) None of the above is correct.

Answer 1

a) If the marginal benefit (MB) of the public health interventionis greater than its marginal cost (MC) at a certain program cost, further investment in the flu vaccination program seems to be a good idea at that spending level.

The marginal benefits, I.e. the additional benefits received from the public health intervention more than the marginal costs would impact the further investment in the program. If Marginal cost is less than marginal benefit at a certain spending level would mean the public is receiving and more health benefits as compared to the costs involved of the government, which is actually the government's aim. Without having benefits and just spending more on costs will not be beneficial.