Just north of the town of Muskrat, Ontario is the town of Brass Monkey, population 4,500. Brass Monkey, like Muskrat, has a single public good, the town skating rink and a single private good, Labatt Ale. Everyone's utility function is UXX, Y)= X₁-81/Y, where X; is the number of bottles of ale consumed by i and Yis the size of the skating rink in square meters. The price of ale is $1 per bottle. The cost of the skating rink to the city is $5 per square meter. Everyone has an income of at least $5,000. What is the Pareto efficient size for the town skating rink? 270 square meters. 140 square meters. 195 square meters. 00

Just north of the town of Muskrat, Ontario is the town of Brass Monkey, population 4,500. Brass Monkey, like Muskrat, has a single public good, the town skating rink and a single private good, Labatt Ale. Everyone's utility function is UXX, Y)= X₁-81/Y, where X; is the number of bottles of ale consumed by i and Yis the size of the skating rink in square meters. The price of ale is $1 per bottle. The cost of the skating rink to the city is $5 per square meter. Everyone has an income of at least $5,000. What is the Pareto efficient size for the town skating rink? 270 square meters. 140 square meters. 195 square meters. 00

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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