A Small Community Has 10 People, Each of Whom Has

question 22

Multiple Choice

A small community has 10 people, each of whom has a wealth of $18,000.Each individual must choose whether to contribute $200 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 .80 times the total amount of money contributed by individuals in the community.

• A)This game has a Nash equilibrium in which 5 people contribute $200 and for public entertainment and 5 people contribute nothing.
• B)This game has no Nash equilibrium in pure strategies, but has a Nash equilibrium in mixed strategies.
• C)This game has two Nash equilibria, one in which everybody contributes $200 and one in which no-body contributes $200.
• D)This game has a dominant strategy equilibrium in which all 10 citizens contribute $200 to support public entertainment.
• E)This game has a dominant strategy equilibrium in which nobody contributes anything for public entertainment.

---

Definitions:

Process Costing

Process costing is a cost accounting method used for homogeneous products, where the costs are assigned to batches of products instead of individual units.

Conversion Costs

The sum of labor and overhead expenses required to convert raw materials into finished products.

Equivalent Units

Equivalent Units are a concept in cost accounting used to represent the amount of work done during a period, expressed in fully completed units of output.

Cost Reconciliation

The process of ensuring that the costs recorded in the accounting system match the actual expenses incurred, especially in a manufacturing or production process.