5. Fred, Chris and Ruth are housemates. Their house is old, and gets very dusty. However they can reduce the amount of dust in the house by spending time cleaning.

5. Fred, Chris and Ruth are housemates. Their house is old, and gets very dusty. However they can reduce the amount of dust in the house by spending time cleaning. . The value each person places on having a clean house is shown in the table below Total hours of Fred’s total benefit Chris’s total benefit Ruth’s total benefit
cleaning a. Draw a table showing the marginal benefit to Fred, to Chris and to Ruth of time spent
cleaning.
b. If spending an hour cleaning means giving up $15 in wages, how many hours will each of of the housemates spend cleaning? State the assumptions behind your answer. c. Add two more columns to yourtable in part (a) showing (i) the combined marginal
benefit, taking together Fred’s benefit, Ch ris’s benefit, and Ruth’s benefit, of cleaning
and (ii) the marginal cost of cleaning, given a $15 wage rate. Use these to draw a
diagram showing the combined marginal benefits of cleaning, and the marginal cost of
cleaning. is the efficient amount of time to spend cleaning? d. Describe two things that the housemates can do to ensure that an efficient level of
cleaning is achieved. Explain how your suggestions solve the free-rider problem. e. Describe one thing that the housemates can do to ensure that an equitable division of
cleaning is achieved. Explain what an equitable division of cleaning looks like in this
context, and why.

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