(Figure: Externality Table I) the Table Shows the Information for a Public

question 44

Multiple Choice

(Figure: Externality Table I) The table shows the information for a public good being provided to two citizens. Based on the table, what is the equilibrium quantity?
$\begin{array}{|r|r|r|r|}\hline \text { Q } & \text { Ann's MPB } & \text { Ben's MPB } & \text { MSC } \\\hline 1 & \$ 10 & \$ 12 & 1 \\\hline 2 & 8 & 9 & 3 \\\hline 3 & 6 & 6 & 5 \\\hline 4 & 4 & 3 & 7 \\\hline 5 & 2 & 0 & 9 \\\hline 6 & 0 & 0 & 11 \\\hline 7 & 0 & 0 & 13\\\hline\end{array}$

• A) 1
• B) 4
• C) 5
• D) 7

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Definitions:

Reserves

Assets kept on hand by a bank or financial institution to meet emergency needs or regulatory requirements.

Transactions Demand

The demand for money for the purpose of carrying out transactions or day-to-day expenditures.

Medium Of Exchange

An intermediary instrument, such as currency or digital tokens, used to facilitate the sale, purchase, or trade of goods and services between parties.

Small CDs

Compact discs used for storing digital data, typically with smaller capacity than standard CDs, used for various types of media or data storage.