Table 11-2
Consider the City of Widgetapolis with Only Four

question 85

True/False

Table 11-2
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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$$\begin{array} { l l l l l } \hline \text { Hours } & \text { John } & \text { James } & \text { Mary } & \text { Lydia } \\\hline 1 & \$ 30 & \$ 50 & \$ 40 & \$ 10 \\2 & 25 & 40 & 37 & 9 \\3 & 20 & 30 & 34 & 8 \\4 & 15 & 20 & 30 & 7 \\5 & 9 & 10 & 25 & 6 \\6 & 3 & 0 & 15 & 5 \\7 & 0 & 0 & 5 & 4 \\\hline\end{array}$$ ​
-Refer to Table 11-2. Suppose the cost to clean the lake is $12 per hour and that the residents have agreed to split the cost of cleaning the lake equally. The number of cleaning hours that maximizes total surplus of Widgetapolis is 7 hours.

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Definitions:

Marginal Revenue

The revenue boost from selling an additional unit of a good or service.

Iguanas

Large, herbivorous lizards native to Central and South America, known for their distinctive appearance, including dorsal spines and dewlaps.

Elastic Demand

A scenario in which there's a notable shift in the demand for a product or service due to a variation in its price.

Total Revenue

The entire amount of income generated by the sale of goods or services before any costs or expenses are deducted.