3. Voluntary contributions toward a public good Susan and Becky are considering contributing toward the creation of a building mural. Each can choose whether to contribute $300 to the building mural or to keep that $300 for a cell phone. Since a building mural is a public good, both Susan and Becky will benefit from any contributions made by the other person. Specifically, every dollar that either one of them contributes will bring each of them $0.90 of benefit. For example, if both Susan and Becky choose to contribute, then a total of $600 would be contributed to the building mural. So, Susan and Becky would each receive $540 of benefit from the building mural, and their combined benefit would be $1,080. This is shown in the upper left cell of the first table Since a cell phone is a private good, if Susan chooses to spend $300 on a cell phone, Susan would get $300 of benefit from the cell phone and Becky wouldn't receive any benefit from Susan's choice. If Susan still spends $300 on a cell phone and Becky chooses to contribute $300 to the building mural, Susan would still receive the $270 of benefit from Becky's generosity. In other words, if Susan decides to keep the $300 for a cell phone and Becky decides to contribute the $300 to the public project, then Susan would receive a total benefit of $300 + $270 = $570, Becky would receive a total benefit of $270, and their combined benefit would be $840. This is shown in the lower left cell of the first table. Complete the following table, which shows the combined benefits of Susan and Becky as previously described. Becky Contributes Doesn't contribute Contributes $1,080 Susan Doesn't contribute $840 Of the four cells of the table, which gives the greatest combined benefits to Susan and Becky? O When neither Susan nor Becky contributes to the building mural O When both Susan and Becky contribute to the building mural O When Susan contributes to the building mural and Becky doesn't, or vice versa Now, consider the incentive facing Susan individually. The following table looks similar to the previous one, but this time, it is partially completed with the individual benefit data for Susan. As shown previously, if both Susan and Becky contribute to a public good, Susan receives a benefit of $540. On the other hand, if Becky contributes to the building mural and Susan does not, Susan receives a benefit of $570. Complete the right-hand column of the following table, which shows the individual benefits of Susan. Hint: You are not required to consider the benefit of Becky. Becky Contribute Doesn't contribute Contribute $540, - Susan Doesn't contribute $570, - 1. - If Becky decides to contribute to the building mural, Susan would maximize her benefit by choosing to the building mural. On the other hand, if Becky decides not to contribute to the building mural, Susan would maximize her benefit by choosing to the building mural. These results illustrate Grade It Now Save & Continue Continue without saving