The monthly rental rate for a satellite dish antenna is $200.The maximum marginal benefit that any resident of a condominium community will obtain per month from the antenna is $50.There are 100 residents in the community, none of whom values the antenna at less than $25 per month.Assuming that the antenna is a pure public good for residents of the community,

Question

Quizplus · Accepted Answer

Since the antenna is a pure public good, it provides the same benefit to all members of the community. Therefore, it is more efficient for the members of the community to rent an antenna for their common use rather than each resident renting their own antenna. The marginal cost of the antenna is $2 per person ($200/100 residents), which is less than the maximum marginal benefit of $50 per person. By sharing the cost of the antenna, each member of the community can obtain a benefit that exceeds their cost of $2, making it an efficient choice for the community to rent the antenna for their common use.

The Monthly Rental Rate for a Satellite Dish Antenna Is