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2. The village of Oughtawa, Ontario, population 1,000, has a single public good, the town's outdoor skating rink (allegedly the world's largest), and a single
2. The village of Oughtawa, Ontario, population 1,000, has a single public good, the town's outdoor skating rink (allegedly the world's largest), and a single private good, Fried- Dough (it's better than it sounds). Everyone's utility function is Ui(X,;, Y) = X,- 640/Y, where X,- is the number of servings of Fried-Dough consumed byi and Y is the size ofthe skating rink in square meters. The Fried-Dough is $1 per serving. The cost of the skating rink to the village is $16 per square meter. What is the Pareto efficient size for the village skating rink? a. 200 m2 b. 280 m2 c. 340 m2 2 d. 400 m
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