The Following Information Is for a Public Good

question 123

Multiple Choice

The following information is for a public good.P_a and P_b are the prices that individuals A and B are willing to pay for the last unit of a public good, rather than do without it.These people are the only two members of society.Refer to the data below.If the marginal cost of this good at the optimal quantity is $4, the optimal quantity must be:

• A)1 unit.
• B)2 units.
• C)3 units.
• D)4 units.

---

Definitions:

Displacement

in psychology, refers to the unconscious transfer of an intense emotion from its original object to another one.

Aggressive Impulses

Innate or instinctual drives that lead to aggressive behaviors, which can stem from frustration or perceived threats.

Defense Mechanism

Unconscious psychological strategies used by individuals to cope with reality and maintain self-image.

Reaction Formation

A defense mechanism in which unacceptable thoughts or desires are expressed as their opposites, often to hide one's true feelings.