# a. Use the data below to derive the demand schedule for a public good.Instructions: Enter your answers as whole numbers.DemandIndividual #1Individual #2Individual #3Public GoodPriceQdPriceQdPriceQdPriceQd\$8\$81\$801772027661351524542443533363464227257118851b. Using the following supply schedule, determine the optimal quantity of this public good.QuantitySuppliedPrice\$19101681364107241coLCLCcCLOLC

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Step 1

To find the demand schedule for public goods we need to do a vertical summation of demand curves. As the buyers of public goods mostly do not reveal their preferences in the market. The ‘willingness to pay determines the collective demand curve for the public. With the help of the following table, Demand schedule of public goods can be found out.

Step 2

Therefore, Price for Public goods are calculated by: Price of individual 1 where it has Qd=1 + Price of individual 2 ...

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