4. Cost-benefit analysis 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 is and . 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 the beautification initiative relied on the ability of the administrators to capture the true willingness to pay of each student accurately. Which of the following scenarios would cause the survey used by the college administrators to yield misleading data on willingness to pay? Check all that apply. An equal number of first, second, third, and fourth year students were surveyed. Students believe that if the initiative does not happen, the funds for the initiative will not be spent elsewhere.For the students of the college, the visual appearance of the campus is and . Thus, the visual appearance would be classified as a public good. nonrival Suppose the college administrators estimate that the beautification initi rival ost $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.For the students of the college, the visual appearance of the campus is V and I V . Thus, the visual appearance would be excludable nonexcludable ether the initiative should be undertaken, - 1.. u -.y for the beautication project. The classied as a public good. Suppose the college administrators estimate that the beautification initiative will cost $61, administrators conduct a survey of the college's 2,240 students, asking each of them thei 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. greater The calculation of the benefit of the beautification initiative relied on the ability of the administrators to capture the true will less pay of each student accurately.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 should ation initiative relied on the ability of the administrators to capture the true willingness to pay of each student accurately. should not5. Common resources versus private goods Outdoors season is underway in Wisconsin, and Tiana and her dad are planning a weekend fishing trip. They have the choice between fishing the lake near town where anyone is allowed to fish without a permit, or they could drive a short PRIVATE distance to a brook located on a family friend's property in PROPERTY the woods. Assume throughout the problem that all fish caught in either body of water are free for those fishing to keep. The fish in the lake are considered and whereas the fish in the private brook are and . In other words, the fish in the lake are an example of , and the fish in the private brook are an example of Fishing in the lake will likely lead to because of which of the following reasons? O All fishermen will choose to fish in the brook believing that there are more fish there. Anyone can fish in the lake, and one person's fishing activity decreases the ability of someone else to fish with success. Nobody will enjoy fishing because of the lack of private contributions to the maintenance of the lake. O All fishermen will choose to fish in the lake because of the limited access to the brook.The sh in the lake are considered V and V whereas the sh in the private brook are va other words, the sh in the lake are an example of V , and the nonrival in consumption rival in consumption sh in the private brook are an ex. v Fishing in the lake will likely lead t: V because of which of the following reasons? The fish in the lake are considered and whereas the fish in the private brook are and . In other wo he lake are an example of , and the fish in the private brook are an example of nonexcludable excludable Fishing in the lake will likely lead to because of which of the following reasons?The sh in the lake are considered V and V whereas the fish in the private brook are V and V . In other words, the fish in the lake are an example of V , and the - an example of V . lead to V because of which of the following reasons? The sh in the lake are considered V and V whereas the sh in the private brook are v and I v . In other words, the sh in the lake are an example of v . and the fish in the private brook are an exam v exdudable Fishing in the lake will likelyr lead to nonexcludable V because of which of the following reasons? The fish in the lake are considered and whereas the fish in the private brook are and V . In other words, the fish in the lake are an example of , and the fish in the private brook are an example of a public good Fishing in the lake will likely lead to because of which of the following reason a common resource O All fishermen will choose to fish in the brook believing that there are more fish there. a private good O Anyone can fish in the lake, and one person's fishing activity decreases the ability of someone else to fis a club goodThe fish in the lake are considered and whereas the fish in the private brook are and . In other words, the fish in the lake are an example of , and the fish in the private brook are an example of Fishing in the lake will likely lead to a common resource because of which of the following reasons? a club good O All fishermen will choose to fish in at there are more fish there. a public good O Anyone can fish in the lake, and tivity decreases the ability of someone else to fish with success. a private good O Nobody will enjoy fishing because contributions to the maintenance of the lake.Fishing in the lake will likely lead to because of which of the following reasons? O All fishermen will choose t moral hazard t there are more fish there. O Anyone can fish in the lak a natural monopoly ity decreases the ability of someone else to fish with success. O Nobody will enjoy fishing t the Tragedy of the Commons Intributions to the maintenance of the lake. O All fishermen will choose to fish in the lake because of the limited access to the brook.6. Common resources and the tragedy of the commons Musashi, Sean, and Bob are trappers who live next to a recreational hunting area that is open to trapping; in other words, anyone is free to use the recreational hunting area for trapping. Assume that these men are the only three trappers who trap in this recreational hunting area and that the recreational hunting area is large enough for all three trappers to trap intensively at the same time. Each year, the trappers choose independently how often to trap, specifically, they choose whether to trap intensively {that is, to set several traps and hunt long hours, which hurts the sustainability of the recreational hunting area if enough people do it} or to trap nonintensively (which does not hurt the sustainability of the recreational hunting area). None of them has the ability to control how much the others trapr and each trapper cares only about his own profitability and not about the state of the recreational hunting area. Assume that as long as no more than one trapper traps intensively, there are enough animals to restock the recreational hunting area. However, if two or more trap intensively, the recreational hunting area will become useless in the future. Of course, trapping intensively earns a trapper more money and greater profit because he can sell more animals. The recreational hunting area is an example of V because the animals in the recreational hunting area are Vand V. The recreational hunting area is an example of V because the animals in the recreational hunting area are Vand V. Depending on whether Sean and Bob both choose to trap either nonintensiveiy or intensiveiy, iii! in Musashi's profitmaximizing response in the foliowing tabie, given Sean and Bob's actions. Sean and Bob's Actions Trap Nonintensiwelylr Trap Intensively Musashi's ProfitMaximizing Response V v which of the following solutions could ensure that the recreational hunting area is sustainable in the long run, assuming that the regulation is enforceable? Check all that appiy. C Outlaw intensive trapping. r. Develop a program that entices more trappers to move to the area. I: Convert the recreational hunting area to private property, and allow the owner to sell trapping rights. The recreational hunting area is an example of because the animals in the recreational hunting area are and a club good a private good a public good Depending on whether Sean and Bob both choo tensively or intensively, fill in Musashi's profit-maximizing response in the a common resource following table, given Sean and Bob's actions.The recreational hunting area is an example of because the animals in the recreational hunting area are and excludable nonexcludableThe recreational hunting area is an example of because the animals in the recreational hunting area are and nonrival in consumption rival in consumption Depending on whether Sean and Bob both choose to trap either nonintensively or intensively, fill in Musashi's profit-maximizing response in the following table, given Sean and Bob's actions.Depending on whether Sean and Bob both choose to trap either nonintensively or intensively, fill in Musashi's profit-maximizing response in the following table, given Sean and Bob's actions. Sean and Bob's Actions Trap Nonintensively Trap Intensively Musashi's Profit-Maximizing Response Trap Intensively Which of the following solutions could ensu I hunting area is sustainable in the long run, assuming that the regulation is enforceable? Check all that apply. Trap Nonintensively O Outlaw intensive trapping. Develop a program that entices more trappers to move to the area. Convert the recreational hunting area to private property, and allow the owner to sell trapping rights.Depending on whether Sean and Bob both choose to trap either nonintensively or intensively, fill in Musashi's profit-maximizing response in the following table, given Sean and Bob's actions. Sean and Bob's Actions Trap Nonintensively Trap Intensively Musashi's Profit-Maximizing Response Trap Nonintensively Which of the following solutions could ensure that the recreational hunting the long run, assuming that the regulation is enforceable? Check all that apply. Trap Intensively O Outlaw intensive trapping. O Develop a program that entices more trappers to move to the area. Convert the recreational hunting area to private property, and allow the owner to sell trapping rights