- Number of daycare spots funded by the government: 264,000 for everyday daycare service is open.

- Days daycare is open: 260 days per year.

-Parents pay P_parents = $10 per day, per spot.

- The annual expense for the government is $3,088,800,000.

- Assume that ATC and MC are constant and ATC = MC for each spot.

- The demand for public daycare is given by P = 154 - 0.0005Q.

- For simplicity, there isno private provision of daycare. - For simplicity, this is a one-time project and there is no need to calculate NPV, even though you can easily extend this analysis to become a 20-year daycare project with the aid of a computation software.

1] TheP_total, which includes P_parents and the government's expense, is equal to __________ per spot.

a.$50

b.$55

c.$60

d.None of the answers above is correct.

2]The change in total consumer surplus (CS) each year arising from this public daycare program is equal to ____________.

a.$2,805,660,000

b.$2,884,960,000

c.$2,951,260,000

d.None of the answers above is correct.