Table 11-6 Consider the City of Widgetapolis with Only Four Residents, John

question 47

Multiple Choice

Table 11-6
Consider the city of Widgetapolis with only four residents, John, James, Mary, and Lydia. The four residents are trying to determine how many hours to spend in cleaning up the public lake. The table below shows each resident's willingness to pay for each hour of cleaning. ​
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-Refer to Table 11-6. Suppose the cost to clean the lake is $40 per hour and that the residents have agreed to split the cost of cleaning the lake equally. If it was decided that the lake will be cleaned for the number of hours that maximizes total surplus of Widgetapolis, how much individual surplus will Mary receive in total?

• A)-$10
• B)$15
• C)$25
• D)$116

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Definitions:

Raise

The act of collecting or soliciting funds or resources, often for a business venture or project.

Due Diligence Period

A set timeframe during which detailed investigation and evaluation is conducted before entering into an agreement or transaction.

Initial Offer

Typically refers to the first sale of stock by a private company to the public, often associated with an initial public offering (IPO).

Investor

An individual or organization that puts money into financial schemes, shares, or property with the expectation of achieving a profit.