Answer the Question on the Basis of the Following Information

question 65

Multiple Choice

Answer the question on the basis of the following information for a public good.P_a and P_b are the prices that individuals A and B are willing to pay for the last unit of a public good,rather than do without it.These people are the only two members of society. $\begin{array}{c}\begin{array}{c}\underline{\text {Q }}\\1 \\2 \\3 \\4 \\5\end{array}\begin{array}{c}\underline{\mathrm{Pa}_{\mathrm{a}} }\\\$ \\2\\1\\0\\0\end{array}\begin{array}{c}\underline{\mathrm{Pa}_{\mathrm{b}} }\\\$ 5 \\4 \\3 \\2 \\1\end{array}\end{array}$
Refer to the data.The collective willingness of this society to pay for the second unit of this public good is:

• A) $2.
• B) $4.
• C) $6.
• D) $8.

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Definitions:

Statistic

A single measure, reported as a number, used to summarize a set of data.

Null Hypothesis

The hypothesis that there is no significant difference or effect, typically the hypothesis a researcher tries to disprove.

Distribution

Describes how the values of a variable are spread or distributed across different categories or intervals.

P > .05

Indicates that the probability of obtaining the observed data under the null hypothesis exceeds 5%, typically leading to failing to reject the null hypothesis.