Individual i's demand curve for the public good level, z, is given by , where is a positive number (that is provided). The cost per unit of z is $1 (c = 1) and this cost is shared equally among all consumers; thus, the cost per person is per unit of z.

Case

1

2

n

7

5

4

10

2

6

12

11

4

14

5

8

13

NA

8

NA

1.Complete the following table showing the preferred level of z for each voter:

Case 1

Case 2

4

10

2

6

12

11

4

14

5

8

13

X

X

8

X

X

2.Complete the following table:

Case

1

2

Identify the Median Voter

Level of z under majority voting

Social demand curve

Optimal Level of z

3.For both cases, compare the level of z under majority voting with the socially optimal level.Explain the difference (if any) between the two z values