Asked by Emily Jackson on Jul 30, 2024
Verified
Refer to Table 16.5. A point on the market demand curve for this public good would be: at a price of ________ quantity demanded would be ________.
A) $30; 5
B) $50; 3
C) $100; 1
D) $110; 1
Market Demand Curve
A graphical representation that shows the relationship between the price of a good or service and the total quantity demanded by all consumers in the market.
Willingness To Pay
The maximum amount an individual is prepared to sacrifice to procure a good or service or to avoid something undesirable.
- Recognize the attributes of public goods and the challenges linked to supplying them.
Verified Answer
MK
Minoti KapurJul 31, 2024
Final Answer :
D
Explanation :
The market demand for a public good is found by vertically summing individual willingness to pay. At a price of $110, both Person A and Person B are willing to pay for 1 unit ($50 + $60 = $110), so the quantity demanded would be 1.
Learning Objectives
- Recognize the attributes of public goods and the challenges linked to supplying them.