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For Questions 14 and 15 , consider the potential provision of a pure public good (that can be produced in five different positive levels: very

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For Questions 14 and 15 , consider the potential provision of a pure public good (that can be produced in five different positive levels: very low, low, medium, high, or very high). "Zero" production of the good results in both zero benefits and zero costs. The society in which this good is to be produced consists of three different types of people, with benefits for the different possible levels of provision as stated below. For example, if "Medium Provision" of the good is provided, each Type 1 person gets benefits of $17, each Type 2 person gets benefits of $75, and each Type 3 person gets benefits of \$90. As stated in the first column, there are: 100,000 Type I people; 600,000 Type 2 people; and 300,000 Type 3 people (for a total of 1 million people in the society). Total Costs of providing the different levels of the good are stated in the bottom row. 14. The efficient level (i.e., Social Surplus maximizing level) of provision of this public good is A. Low Provision B. Medium Provision C. High Provision D. Very High Provision 15. Suppose that for whatever level of the public good is provided, mandatory taxes are imposed on each person in society equal to Total Costs of provision divided by Total Population (i.e., each person is forced to pay an equal amount in taxes, with taxes imposed to exactly cover the cost of the public good). When the public good is provided and financed in this way, every person in society would be better off if was provided. A. Very Low Provision B. High Provision C. Very High Provision D. None of the above answers are correct (and in fact, none of the five positive levels of the public good would make every person in society better off when financed in the proposed way)

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