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A Village Has Five Residents, Each of Whom Has an Accumulated

question 85

Multiple Choice

A village has five residents, each of whom has an accumulated savings of $50. Each villager can use the money to buy a government bond that pays 10 percent interest per year or to buy a year-old goat, send it onto the commons to graze, and sell it after one year. The price of the goat that the villager will get at the end of the year depends on the amount of weight it gains while grazing on the commons, which in turn depends on the number of goats sent onto the commons, as shown in the table below. Assume that if a villager is indifferent between buying a bond and buying a goat, the villager will buy a goat. $\begin{array} { | c | c | c | } \hline \begin{array} { c } \text { Number af gants } \\\text { an the carmuns }\end{array} & \begin{array} { c } \text { Price per 2-year } \\\text { ald poat (5) }\end{array} & \begin{array} { c } \text { Incame per } \\\text { gant (\$/year) }\end{array} \\\hline 1 & 80 & 30 \\\hline 2 & 75 & 25 \\\hline 3 & 70 & 20 \\\hline 4 & 65 & 15 \\\hline 5 & 55 & 5 \\\hline\end{array}$
When the each villager decides how to invest based on his or her narrow self-interest, total village income will be ________ when the village collectively decides how to invest.

Definitions:

Mental Disorder

A broad range of conditions affecting mood, thinking, and behavior, often leading to distress or impaired functioning in daily life.

Axes

Refers to fixed reference lines for the coordinates of a graph or geometric figure, or to the main or central line that divides symmetry in a figure or shape.

Describes Symptoms

The action of explaining or detailing the signs and indicators of a condition or disease.

American Psychiatric Association

A professional organization of psychiatrists dedicated to ensuring humane care and effective treatment for all persons with mental disorders.