In: Economics
In a four person community, we have elicited each individual’s willingness to pay to build an additional mile of a bike lane. Whatever amount is constructed, the community will split the cost evenly.
Bike Lanes (miles) |
Avery WTP ($) |
Billy WTP ($) |
Cedric WTP ($) |
Doug WTP ($) |
Total WTP ($) |
1 |
42 |
39 |
25 |
12 |
118 |
2 |
36 |
30 |
20 |
9 |
95 |
3 |
30 |
21 |
15 |
6 |
72 |
4 |
24 |
12 |
10 |
3 |
49 |
5 |
18 |
3 |
5 |
0 |
26 |
1. Suppose bike lanes can be built for 52 $ . mi
(a) (1 point) What is the efficient amount of bike lanes to build?
(b) (1 point) Will the majority vote accept this proposal?
2. Suppose the bike lanes can be built for 84 $ . mi
(a) (1 point) What is the efficient amount of bike lanes to build?
(b) (1 point) Will the majority vote accept this proposal?