A Village Has Five Residents,each of Whom Has Accumulated Savings

question 96

Multiple Choice

A village has five residents,each of whom has accumulated savings of $50.Each villager can use the money to buy a government bond that pays 10% 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 table below. $$\begin{array} { c c c } \begin{array} { c } \text { Number of goats } \\\text { on the commons }\end{array} & \begin{array} { c } \text { Price per 2-year-old } \\\text { goat (\$) }\end{array} & \begin{array} { c } \text { Income per goat } \\\text { (\$/year) }\end{array} \\1 & 80 & 30 \\2 & 75 & 25 \\3 & 70 & 20 \\4 & 65 & 15 \\5 & 55 & 5\end{array}$$
Refer to the information given above.If each villager is purely self-interested,how many goats will be sent onto the commons?

• A)2
• B)3
• C)4
• D)5

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Definitions:

Rewards And Punishment

a behavioral principle that posits behavior can be modified by the consequences it produces, with rewards increasing and punishments decreasing the likelihood of a behavior.

Gender Roles

Cultural expectations about what is appropriate behavior for each gender.

Socialization

The acquisition of the norms and roles expected of people in a particular society.

Norms

The unwritten rules that define acceptable behaviors within a society or group.