2. Consider a society consisting with three individuals whose demand curves for a pure public good are Pa = 100-X, P = 110-X, P = 150-X for individual A, B, and C respectively. Marginal costs are constant and equal to $150 for each unit provided. (a) Determine the pareto optimal output rate and calculate the Lindahl prices for each individual.

2. Consider a society consisting with three individuals whose demand curves for a pure public good are Pa = 100-X, P = 110-X, P = 150-X for individual A, B, and C respectively. Marginal costs are constant and equal to $150 for each unit provided. (a) Determine the pareto optimal output rate and calculate the Lindahl prices for each individual.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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