1. This question comes from Getzen (2007) chapter three question 6 page 70.The World Health Organization (WHO) is considering sending a team of experts in to deal withan outbreak of schistosomiasis in a distant country. Sending a larger team will allow them toprevent more fatalities, and they estimate the following effectiveness:
Team Size 0 5 10 15 20 25 30 35 40 45 50
Deaths 1200 500 200 100 60 40 30 25 22 20 20
It costs $5,000 for each team member sent.
(a) Prepare a table with columns: team size, total cost, total lives saved, average cost per lifesaved, marginal cost, marginal lives saved (per 5 team members), marginal cost per life saved.
(b) Suppose saving a life is valued at $10,000. Plot marginal cost per life saved and marginalbenefit per life saved against the total number of lives saved. What is the optimal team size?
(c) Suppose saving a life is valued at $100,000. What is the optimal team size?(d) What size of team gives the most "bang for the buck", i.e. the largest number of lives savedper dollar sent.