Suppose That Mick and Cher Are the Only Two Members

question 1

Multiple Choice

Suppose that Mick and Cher are the only two members of society and are willing to pay $10 and $8, respectively, for the third unit of a public good. Also, assume that the marginal cost of the third unit is $17. We can conclude that

• A)the third unit should not be produced.
• B)the third unit should be produced.
• C)zero units should be produced.
• D)4 units should be produced.

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Definitions:

Community

A group of people living in the same place or having a particular characteristic in common, often sharing a sense of belonging.

Proposed Legislation

Laws or regulations that have been suggested but not yet enacted, typically undergoing review or debate by a legislative body.

Social Welfare Organization

An entity focused on providing services, support, or relief to disadvantaged communities, typically operating on a non-profit basis with goals centered around social betterment.

Lobbying

The act of attempting to influence the actions, policies, or decisions of officials in their professional capacity, often by interest groups.