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The benefit Arthur gets from spending time in hospital following an operation is shown in the table below:
Number of days in hospital
Benefit from hospital stay ($)
0 0
1 500
2 800
3 1000
4 1100
5 1000
With health insurance, each day in hospital costs Arthur $50. Without health insurance, each day in hospital costs him $200. Explain how Arthur should decide how long to spend in hospital following his operation with and without insurance. Explain how having health insurance affects the length of time Arthur chooses to stay in hospital
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