Scenario 22-1 At Issue in a Particular City Vote Is How Much

question 50

Multiple Choice

Scenario 22-1
At issue in a particular city vote is how much to spend, per person, on city parks next year. Among the 10,000 voters, 1,000 prefer to spend $30 per person, but no more; 3,500 prefer to spend $45 per person, but no more; 2,500 prefer to spend $80 per person, but no more; and 3,000 prefer to spend $150 per person, but no more.
-Refer to Scenario 22-1.If there is a vote on whether to spend $80 per person or $110 per person,the median voter will vote to spend

• A)$80 per person and the voting outcome will be $80 per person.
• B)$80 per person and the voting outcome will be $110 per person.
• C)$110 per person and the voting outcome will be $80 per person.
• D)$110 per person and the voting outcome will be $110 per person.

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Definitions:

Nondiscriminating Monopolist

A monopolist who charges all consumers the same price for its product, as opposed to practicing price discrimination.

Marginal Revenue

The extra revenue generated by the sale of an additional unit of a product or service.

Network Effects

The phenomenon where increased numbers of users or participants improve the value of a good or service.

Natural Monopoly

A situation where due to high fixed costs or other barriers, a single firm can supply a product or service to an entire market at a lower cost than what two or more firms could.