Table 11-1 Consider the Town of Springfield with Only Three Residents, Sophia

question 181

Multiple Choice

Table 11-1
Consider the town of Springfield with only three residents, Sophia, Amber, and Cedric. The three residents are trying to determine how large, in acres, they should build the public park. The table below shows each resident's willingness to pay for each acre of the park.
-Refer to Table 11-1. Suppose the cost to build the park is $24 per acre and that the residents have agreed to split the cost of building the park equally. If the residents decide to build a park with size equal to the number of acres that maximizes total surplus from the park, how much total surplus will Sophia receive?

• A)-$5
• B)-$2
• C)$0
• D)$2

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Definitions:

Joint Ventures

Business arrangements in which two or more parties agree to pool their resources for the purpose of accomplishing a specific task or business activity.

Corporate Codes

Guidelines and policies established by companies to govern behavior, ethics, and practices within their organizations.

Enforcement

The act of ensuring compliance with laws, regulations, or agreements, often by taking legal action against violators.

Financialization

The method through which financial markets, institutions, and elites increasingly affect economic policy and outcomes.