Suppose Kevin and Sara are the only inhabitants of an island with no butterfly species. Butterfly species are a public good that can be purchased for the island. Kevin would pay up to $90 for the first butterfly species, $40 for the second butterfly species, and nothing for any additional butterfly species. Sara would pay up to $60 for each butterfly species up to a quantity of five.
On the graphs below, draw the demand curves for butterfly species for Kevin, Sara, and the market. Label each axis and the (specific numerical) height of each demand curve for each quantity up to 5 butterfly species.
If butterfly species cost $95 each, what is the socially optimal quantity of butterfly species? __________

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The Answer of Suppose Kevin and Sara are the only inhabitants of an island with no butterfly species. Butterfly species are a public good that can be purchased for the island. Kevin would pay up to $90 for the first butterfly species, $40 for the second butterfly species, and nothing for any additional butterfly species. Sara would pay up to $60 for each butterfly species up to a quantity of five.
On the graphs below, draw the demand curves for butterfly species for Kevin, Sara, and the market. Label each axis and the (specific numerical) height of each demand curve for each quantity up to 5 butterfly species.
If butterfly species cost $95 each, what is the socially optimal quantity of butterfly species? __________

Suppose Kevin and Sara Are the Only Inhabitants of an Island