Explain Why All Voters Will Have Single-Peaked Preferences for a Pure

question 24

Essay

Explain why all voters will have single-peaked preferences for a pure public good if the marginal benefit they receive from that good declines as more is made available per year.Explain how each voter decides whether to vote in favor of or against a proposal for a certain quantity of the pure public good to be made available per year.Assuming that tax shares are given, what can you say about the political equilibrium under majority rule? Show how an increase in the average cost of producing the pure public good will affect the political equilibrium.

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Definitions:

Segregate Market

The practice of dividing or separating markets into sections or categories based on consumer demographics, behaviors, or other characteristics.

Price Elasticity

A measure of how much the quantity demanded of a good responds to a change in its price, with elasticity referring to the degree of responsiveness.

Good Substitutes

Products or services that can be used in place of each other, having a high cross-elasticity of demand.

Income Elasticity Coefficient

A measure indicating how much the quantity demanded of a good responds to change in consumer income.