A Small Community Has 10 People, Each of Whom Has

question 24

Multiple Choice

A small community has 10 people, each of whom has a wealth of $2,000.Each individual must choose whether to contribute $100 or $0 to the support of public entertainment for their community.The money value of the benefit that a person gets from this public entertainment is .65 times the total amount of money contributed by individuals in the community.

• A)This game has a dominant strategy equilibrium in which all 10 citizens contribute $100 to support public entertainment.
• B)This game has two Nash equilibria, one in which everybody contributes $100 and one in which nobody contributes $100.
• C)This game has no Nash equilibrium in pure strategies, but has a Nash equilibrium in mixed strategies.
• D)This game has a Nash equilibrium in which 5 people contribute $100 and for public entertainment and 5 people contribute nothing.
• E)This game has a dominant strategy equilibrium in which nobody contributes anything for public entertainment.

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Definitions:

Excise Tax

A tax levied on specific goods, services, or transactions, often to discourage their use or generate revenue.

Government Salaries

The remuneration received by individuals employed by the government, including wages, benefits, and allowances.

Property Tax

A tax levied by local governments on real estate properties, based on the assessed value of the property, to fund public services like education and infrastructure.

Social Security Payments

Regular payments made by the government to support individuals who are retired, disabled, or otherwise entitled to receive such benefits according to social welfare programs.