If the marginal cost of gardener is $500 no matter how many are employed. The marginal benefits pergardener varies for five residents according to the following table:Marginal Benefit for EachGardenerVoter14A575550525500B275200125C1251007512510075E10075ResultA) If each voter is assigned to pay the same tax share of $100 per gardener, what is the political equilibriumunder majority rule?B) Show that the Lindahl equilibrium will differ from the political equilibrium under majority rule?

The greatest amount a buyer will pay for an additional commodity or service is known as marginal…

A) If each voter is assigned to pay the same tax share of $100 per gardener, what is the political equilibrium under majority rule? B) Show that the Lindahl equilibrium will differ from the political equilibrium under majority rule?

A) If each voter is assigned to pay the same tax share of $100 per gardener, what is the political equilibrium under majority rule? B) Show that the Lindahl equilibrium will differ from the political equilibrium under majority rule?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

If the marginal cost of gardener is $500 no matter how many are employed. The marginal benefits per
gardener varies for five residents according to the following table:
Marginal Benefit for EachGardener
Voter
1
4
A
575
550
525
500
B
275
200
125
C
125
100
75
125
100
75
E
100
75
Result
A) If each voter is assigned to pay the same tax share of $100 per gardener, what is the political equilibrium
under majority rule?
B) Show that the Lindahl equilibrium will differ from the political equilibrium under majority rule?

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