Options :(first blank to last blank) rival/non-rival excludable/non excludable l

Question

Options :(first blank to last blank)

rival/non-rival

excludable/non excludable

less/greater

should not/should

4. Cost-benefit analysis A local college is deciding whether to conduct a campus beautification initiative that would involve various projects, such as planting trees and remodeling buildings, to make the campus more aesthetically pleasing. For the students of the college, the visual appearance of the campus is would be classified as a public good and . Thus, the visual appearance Suppose the college administrators estimate that the beautification initiative will cost $2,040. To decide whether the initiative should be undertaken, administrators conduct a survey of the college's 420 students, asking each of them their willingness-to-pay for the beautification project. The average willingness-to-pay, as revealed by the survey, is $12. Because the estimated benefit is than the The benefit of the beatification initiative, as suggested by the survey, is cost, the college administrators undertake the beautification initiative. The calculation of the benefit of the beatification initiative relied on the ability of the administrators to accurately capture the true willingness-to-pay of each student. Which of the following scenarios would cause the survey used by the college administrators to yield misleading willingness-to-pay data? Check all that apply. Students believe that if the initiative does not happen, the funds for the initiative will not be spent elsewhere. Students believe they will eventually be charged their willingness-to-pay Grade It Now Save & Continue Continue without saving

Explanation / Answer

Ans)

non rival
non excludable
Public goods are goods which are both non rival and non excludable in consumption.

Collection=12*420=5040 Costs=2040
benefit=5040-2040=3000
more
should

Students believe that if the initiative does nto happen, the funds for the intiative will not be spent elsewhere.

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