Two families (A and B) live on a dark street. The local council will provide streetlights if the two

families are willing to pay for the running costs, which are $30 a month per streetlight. The

demand of the two families for streetlights is estimated to be

A A P = 40 2Q and B B P = 30 2Q , where P is the price the family is willing to pay for a

streetlight per month.

i. Express the total demand function for streetlights.

ii. How many streetlights should be provided?

iii. If the council charges family A $15 and family B $15, could unanimity be achieved?

iv. What would be the share of expenses between family A and B if unanimity is to be

achieved?