Question 1 The mayor of a village is considering to build a public park. There are 5 people living in the village and the benefits from the public park are given as follows: v1=$0, v2=$100, v3=$200, v4=$300, v5=$400. The cost of the park is $800. Consider the demand revealing (Vickrey-Clarke-Groves) mechanisms. Which of the following statement is false? A. In the Groves mechanism, Individual 1 receives $200 B. Optimal level of public good is provided C. Individuals report their true benefits to the municipality D. In the Clarke pivotal mechanism, Individual 1 neither receives nor pays any money E. None of the above

Question 1 The mayor of a village is considering to build a public park. There are 5 people living in the village and the benefits from the public park are given as follows: v1=$0, v2=$100, v3=$200, v4=$300, v5=$400. The cost of the park is $800. Consider the demand revealing (Vickrey-Clarke-Groves) mechanisms. Which of the following statement is false? A. In the Groves mechanism, Individual 1 receives $200 B. Optimal level of public good is provided C. Individuals report their true benefits to the municipality D. In the Clarke pivotal mechanism, Individual 1 neither receives nor pays any money E. None of the above

Microeconomics

13th Edition

ISBN:9781337617406

Author:Roger A. Arnold

Publisher:Roger A. Arnold

Chapter17: Market Failure: Externalities, Public Goods, And Asymmetric Information

Section: Chapter Questions

Problem 7QP

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