Table 1-3
Santiago runs a comic book store in the town of East Arbor. He is debating whether he should extend his hours of operation. Santiago figures that his sales revenue will depend on the number of hours the store is open as shown in the table above. He would have to hire a worker for those hours at a wage rate of $18 per hour.
-Refer to Table 1-3. What is Santiago's marginal benefit if he decides to stay open for two hours instead of one hour?
A) $40
B) $50
C) $120
D) $190

Question

Table 1-3
  Santiago runs a comic book store in the town of East Arbor. He is debating whether he should extend his hours of operation. Santiago figures that his sales revenue will depend on the number of hours the store is open as shown in the table above. He would have to hire a worker for those hours at a wage rate of $18 per hour.
-Refer to Table 1-3. What is Santiago's marginal benefit if he decides to stay open for two hours instead of one hour?
A) $40 
B) $50 
C) $120 
D) $190

Quizplus · Accepted Answer

Santiago's marginal benefit is equal to the additional revenue he will earn from staying open for an additional hour, minus the cost of hiring the worker for that additional hour.

If Santiago stays open for 1 hour, his revenue is $80. 
If he stays open for 2 hours, his revenue is $120.

Therefore, his additional revenue from staying open for an additional hour is $120 - $80 = $40.

However, he needs to subtract the cost of hiring the worker for that additional hour, which is $18.

Therefore, his marginal benefit is $40 - $18 = $22.

Since the question asks what the marginal benefit is for staying open for two hours instead of one, we don't need to consider any other options. The answer is B.

Table 1-3 Santiago Runs a Comic Book Store in the in the Town