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The marginal benefits of five individuals in a community for a public good, security guards, are as follows: Marginal Benefit for Each Guard 1 2

The marginal benefits of five individuals in a community for a public good, security guards, are as follows: Marginal Benefit for Each Guard 1 2 3 4 Mohd 3000 2850 2650 2300 Jamilah 2850 2500 2350 2000 Fatimah 2500 2000 1790 1000 Suraya 2000 1810 1150 1200 Agus 1800 1250 1010 600 The marginal cost of providing the public good, MC = RM8950 Determine the political equilibrium under simple majority rule. Is the revenue collection sufficient to pay the cost of equilibrium number of guards? How does the voting outcome relate to the median voter theorem? If the guard service was a private good, how many guards would be hired? Explain why the market is inefficient.

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