c. Label and describe what happens after the imposition on producers of the tax, if anything, to the size of the CONSUMER AND PRODUCER WELFARE in this market UNDER EACH OF THE TWO following assumptions. The government gives the total tax back to the people in the form of a cash payment. The government takes the money and uses it for building Saddam Hussein's summer palace (Hussein was the former leader of Iraq.). d. Do you think that the government has the right to intervene with the market in this way. If so, why? 3. What is a merit good? Why do we have merit goods? Would you consider the Sacramento Ballet a Merit Good? What about performances at the UC Davis Mondavi Center? What about this ECN 130 course? If the owner of the Oakland Raiders football team threatens to pull his team out of Oakland unless the City of Oakland raises taxes and pay for a new stadium, are Oakland Raider games in Oakland now a public good. If you live in Oakland, pay taxes and hate football, how is your welfare affected? If you live in San Francisco and do not pay Oakland taxes, but go to Raider games, are you a free rider? Why or why not? 4. Your government decides to construct a huge $50 million sports/recreational facility in your city from a budget surplus. The capacity of the facility can handle all of the people in the city should they want to work out. Once built and equipped, admission will be free to all citizens. In terms of the formal definitions of a Public Good, is the new sports facility a public good (simply because it was provided by a government)? Also, with no fees collected for its use, in what ways do you think the government hopes that it (or the community) will be compensated for this $50 million outlay