2. Elizabeth owns some land in Scotland where she vacations from time to time. Anne owns an adjoining plot of land, and wants to buy Elizabeth's land. Suppose Elizabeth values her land at $1.5 million. Anne values the land at $2.8 million. Explain which of the following are Kaldor Hicks improvements or not. Which of the following are Kaldor-Hicks improvements? a. Anne buys the land for $2 million. b. Anne buys the land $2.8 million. c. The local government forces Elizabeth to sell the land for $1.2 million. d. Anne gets drunk and gives Elizabeth $3 million for the land.

2. Elizabeth owns some land in Scotland where she vacations from time to time. Anne owns an adjoining plot of land, and wants to buy Elizabeth's land. Suppose Elizabeth values her land at $1.5 million. Anne values the land at $2.8 million. Explain which of the following are Kaldor Hicks improvements or not. Which of the following are Kaldor-Hicks improvements? a. Anne buys the land for $2 million. b. Anne buys the land $2.8 million. c. The local government forces Elizabeth to sell the land for $1.2 million. d. Anne gets drunk and gives Elizabeth $3 million for the land.

Brief Principles of Macroeconomics (MindTap Course List)

8th Edition

ISBN:9781337091985

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter8: Savings,investment And The Financial System

Section: Chapter Questions

Problem 7PA

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