Suppose that Angela, Bob, and Charlene live on the same street in a northern town. In the winter, all of them like to have their street plowed. Each of them have the same inverse demand function for snow removal, given by MB = 23 - 3.9 x Q, where MB is the maximum they would pay for Q plowings per month. Suppose that the marginal cost of plowing the snow one more time is constant at MC = $35. We ignore the odd fact that MC would likely decrease with higher frequency Q, because less snow would build up since the last plowing, and it would require less time and fuel. What is the socially efficient frequency of plowing that should be done? Give your answer to the nearest 0.1 snow removals per month.

[Hint: To find the social demand function for a public good, we add the individual demands "vertically" on the Price/MB axis, rather than horizontally, as we do for private goods. I.e., we add the individual marginal benefits at each Q, then find where MC intersects aggregate demand. Think about why this is true for non-rival, non-excludable consumption. (c) What would be the socially efficient amount of plowing if the marginal cost of plowing were $5?

Thought questions to check your knowledge: (1) What happens to optimal Q if the price of diesel fuel increases? (2) What happens to optimal Q if more families build houses along the street? Test by increasing MC, then by increasing the number of individual demand functions.