Solved

Just North of the Town of Muskrat, Ontario,is the Town

Question 2

Multiple Choice

Just north of the town of Muskrat, Ontario,is the town of Brass Monkey, population 12,800.Brass Monkey, like Muskrat, has a single public good, the town skating rink and a single private good, Labatt Ale.Everyone's utility function is Ui(Xi, Y) = Xi - 121/Y, where Xi is the number of bottles of ale consumed by i and Y is the size of the skating rink in square meters.The price of ale is $1 per bottle.The cost of the skating rink to the city is $8 per square meter.Everyone has an income of at least $5,000.What is the Pareto efficient size for the town skating rink?


A) 560 square meters.
B) 885 square meters.
C) 280 square meters.
D) 440 square meters.
E) None of the above.

Correct Answer:

verifed

Verified

Related Questions

Unlock this Answer For Free Now!

View this answer and more for free by performing one of the following actions

qr-code

Scan the QR code to install the App and get 2 free unlocks

upload documents

Unlock quizzes for free by uploading documents