Answered step by step
Verified Expert Solution
Question
1 Approved Answer
a . If the town decided to use Lindahl pricing ( a tax based on a Lindahl equilibrium ) to collect enough money to provide
a If the town decided to use Lindahl pricing a tax based on a Lindahl equilibrium to collect enough money to provide the socially efficient quantity of acres, what would be each persons tax share?
b Suppose instead of a Lindahl tax the town decides to tax each person equally and then put the tax up for a vote. What tax would each person in the community need to pay to have enough tax revenue to pay for the socially efficient number of acres?
c. If the tax you calculated was put into a majority rule referendum vote, would the playground be built?
Step by Step Solution
★★★★★
3.36 Rating (143 Votes )
There are 3 Steps involved in it
Step: 1
a With Lindahl pricing each person would pay a tax based on their marginal valuation of the park The ...Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started