Lydia's Marginal Benefits

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Using marginal analysis, Lydia should extend her nail salon's hours of operations by five hours. If Lydia extends her hours by six, she would lose $5 in revenue. Lydia's marginal benefit, if she decides to stay open for two hours instead of one hour, is $25. Lydia's marginal cost, if she decides to stay open for two hours instead of one hour, is $10.
DeShawn's marginal benefit, if he sells a basic detailing package, is $75. The marginal cost of adding the engine detailing to the basic detailing package is $20. DeShawn should not continue to offer the engine detailing service because the marginal cost is higher than the marginal benefit. DeShawn gains $35 from a basic package and gains $30 from the upgraded package.

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