Only Graph it please! “Summer open-air concerts are a pure public good in a small town. The average cost of each concert per night is constant at $500. Explain why it would be inefficient to require each resident of a community to hire their own orchestra at the $500 rate for each concert. Assuming that the marginal benefit of the first concert is $25 for each of the 1,000 residents of the community, prove that it will be efficient to have more than one concert per summer. If the concert were financed with voluntary contributions, what conditions would have to prevail to achieve the efficient number of concerts per summer?” Identify your final group answer with the subject "Final Response".

Only Graph it please! “Summer open-air concerts are a pure public good in a small town. The average cost of each concert per night is constant at $500. Explain why it would be inefficient to require each resident of a community to hire their own orchestra at the $500 rate for each concert. Assuming that the marginal benefit of the first concert is $25 for each of the 1,000 residents of the community, prove that it will be efficient to have more than one concert per summer. If the concert were financed with voluntary contributions, what conditions would have to prevail to achieve the efficient number of concerts per summer?” Identify your final group answer with the subject "Final Response".

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter19: Externalities And Public Goods

Section: Chapter Questions

Problem 19.9P

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