I need help with question 4 please Problem 1: Public GoodsSuppose that three individuals each benefit from a public good. The marginal cost of the publicgood provision is fixed at $15 per unit:MC = $15Whereas each of the three individuals (Person 1, Person 2, and Person 3) each receive amarginal benefit for each unit of the public good defined by:Person 1: MB₁ = 30 - 2QPerson 2: MB₂ = 20 - 20Person 3: MB3 = 21 - QAs is the case with public goods, they are non-rival. Therefore, note that each person gainsbenefit from the total amount of Q purchased by everybody, not just the individual value thatthey purchase themselves (e.g. Q₁, Q₂, or Q3).1. Draw a figure with all three MB curves, the MC curve, and the Social Marginal Benefit(SMB) Curve. Label all x-intercepts, y-intercepts, and kinks in the SMB curve.2. Given the above MB curves, write down the Social Marginal Benefit Curve as a functionof Q. Show your work.3. What is the Socially Optimal Choice of Q and would any private individual purchase thison their own? Show your work.Suppose that you are on the town council, and that the town currently has Q = 11 of this publicgood. You are considering raising money from Persons 1-3 in order to buy another unit of Q,where Person 1 pays t₁, Person 2 pays t2, Person 3 pays t3 (t₁, t2, and t3 can all be different).4. Propose a set of taxes (t₁, t2, t3) such that they both (i) raise enough money to buy theextra unit of Q, and (ii) that they make each person strictly better off. Show your work.

Given: 3 individuals benefit from a public good. MC of public good = $15. Three individuals named…

Suppose that you are on the town council, and that the town currently has Q = 11 of this public good. You are considering raising money from Persons 1-3 in order to buy another unit of Q, where Person 1 pays t₁, Person 2 pays t₂, Person 3 pays t3 (t₁, t2, and t3 can all be different). 4. Propose a set of taxes (t₁, tz, t3) such that they both (i) raise enough money to buy the extra unit of Q, and (ii) that they make each person strictly better off. Show your work.

Suppose that you are on the town council, and that the town currently has Q = 11 of this public good. You are considering raising money from Persons 1-3 in order to buy another unit of Q, where Person 1 pays t₁, Person 2 pays t₂, Person 3 pays t3 (t₁, t2, and t3 can all be different). 4. Propose a set of taxes (t₁, tz, t3) such that they both (i) raise enough money to buy the extra unit of Q, and (ii) that they make each person strictly better off. Show your work.

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

I need help with question 4 please

Problem 1: Public Goods
Suppose that three individuals each benefit from a public good. The marginal cost of the public
good provision is fixed at $15 per unit:
MC = $15
Whereas each of the three individuals (Person 1, Person 2, and Person 3) each receive a
marginal benefit for each unit of the public good defined by:
Person 1: MB₁ = 30 - 2Q
Person 2: MB₂ = 20 - 20
Person 3: MB3 = 21 - Q
As is the case with public goods, they are non-rival. Therefore, note that each person gains
benefit from the total amount of Q purchased by everybody, not just the individual value that
they purchase themselves (e.g. Q₁, Q₂, or Q3).
1. Draw a figure with all three MB curves, the MC curve, and the Social Marginal Benefit
(SMB) Curve. Label all x-intercepts, y-intercepts, and kinks in the SMB curve.
2. Given the above MB curves, write down the Social Marginal Benefit Curve as a function
of Q. Show your work.
3. What is the Socially Optimal Choice of Q and would any private individual purchase this
on their own? Show your work.
Suppose that you are on the town council, and that the town currently has Q = 11 of this public
good. You are considering raising money from Persons 1-3 in order to buy another unit of Q,
where Person 1 pays t₁, Person 2 pays t2, Person 3 pays t3 (t₁, t2, and t3 can all be different).
4. Propose a set of taxes (t₁, t2, t3) such that they both (i) raise enough money to buy the
extra unit of Q, and (ii) that they make each person strictly better off. Show your work.

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I need help for these questions l.
Imagine you are the mayor of a town and you are trying to decide if you should pay for a fireworks show. Your staff survey your 400 citizens who say that they each value a fireworks show at $10. The fireworks show only costs $3,000 so you put on the show but when you ask for donations to pay for the fireworks you only receive $25 total. What does this result show? Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer. You staff's survey must have overestimated the value of a fireworks show. b The fireworks cost must have been greater than their economic benefit. The firework show suffered from the Tragedy of the Commons problems d The town's citizens were free-riders.
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