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Question 3 (6 points) Two housemates are fed up of doing the washing up and want to buy a dishwasher (which is a public good
Question 3 (6 points) Two housemates are fed up of doing the washing up and want to buy a dishwasher (which is a public good for them). Person 1's utility function is U,(5, MJ) - (1 + 5)M, and person 2's utility function is U.(S. My - (3 + 5)My where 5- 0 if they don't buy the dishwasher and S- 1 if they do, and where My and My are the amount of money they spend on their respective private consumptions. Person 1 has total income (2,000, and person 2 has total income $2,400. The maximum amount that they could pay for the dishwasher and still find a contribution scheme where they are both better off than without it is; E1,800 OE1,400 (1.600 12,000 12400
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