A local college is deciding whether to conduct a campus beautification initiative that would involve various projects, such as planting trees and remodeling buildings, to make the campus more aesthetically pleasing. and (excludable, non- For the students of the college, the visual appearance of the campus is (rival, non-rival) excludable)___________ Thus, the visual appearance would be classified as a public good. Suppose the college administrators estimate that the beautification initiative will cost $6,300. To decide whether the initiative should be undertaken, administrators conduct a survey of the college's 470 students, asking each of them their willingness-to-pay for the beautification project. The average willingness-to-pay, as revealed by the survey, is $14. The benefit of the beautification initiative, as suggested by the survey, is (greater, less)___________ than the cost, the college administrators (should, shout not) beautification initiative. Because the estimated benefit is _______undertake the

A local college is deciding whether to conduct a campus beautification initiative that would involve various projects, such as planting trees and remodeling buildings, to make the campus more aesthetically pleasing. and (excludable, non- For the students of the college, the visual appearance of the campus is (rival, non-rival) excludable)_____ Thus, the visual appearance would be classified as a public good. Suppose the college administrators estimate that the beautification initiative will cost $6,300. To decide whether the initiative should be undertaken, administrators conduct a survey of the college's 470 students, asking each of them their willingness-to-pay for the beautification project. The average willingness-to-pay, as revealed by the survey, is $14. The benefit of the beautification initiative, as suggested by the survey, is (greater, less)_ than the cost, the college administrators (should, shout not) beautification initiative. Because the estimated benefit is ___undertake the

Principles of Microeconomics

7th Edition

ISBN:9781305156050

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter11: Public Goods And Common Resources

Section: Chapter Questions

Problem 6PA

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A local college is deciding whether to conduct a campus beautification initiative that would involve various projects, such as planting trees and remodeling buildings, to make the campus more aesthetically pleasing. For the students of the college, the visual appearance of the campus isnonrival andnonexcludable . Thus, the visual appearance would be classified as a public good. Suppose the college administrators estimate that the beautification initiative will cost $61,110. To decide whether the initiative should be undertaken, administrators conduct a survey of the college's 2,240 students, asking each of them their willingness to pay for the beautification project. The average willingness to pay, as revealed by the survey, is $20. The benefit of the beautification initiative, as suggested by the survey, is . Because the estimated benefit is than the cost, the college administrators undertake the beautification initiative. The calculation of the benefit of…
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