Final answer:
The ballot measure to create a new lane does not pass because the amount that each of the five individuals needs to contribute ($900) exceeds the valuation of three individuals. Theoretically, it should pass due to the collective valuation of $3 million from the 10,000 townspeople.
Step-by-step explanation:
The question revolves around whether a ballot measure to create a new lane should pass and whether it should pass, based on the willingness to pay by the affected parties. To analyze this, we sum the individual valuations of the project: $1,000 + $800 + $800 + $700 + $1,500 equals $4,800. Since the cost of the lane is $4,500, and the sum of the individual valuations ($4,800) exceeds this cost, the measure could be considered efficient from a collective perspective of these five individuals.
However, if the ballot stipulates that each of these 5 individuals would have to contribute an equal amount, each would need to pay $900. This exceeds the valuations for three of the individuals ($800, $800, and $700), meaning that under equal payment terms, the measure does not appeal to all of them. Therefore, despite the collective valuation exceeding the cost, the measure would not pass if it requires unanimous consent from these five individuals. Furthermore, the willingness to pay for the 10,000 townspeople, who each value the project at $300, resulting in a collective valuation of $3 million, far exceeds the cost. This suggests the measure should pass when considering the broader community's willingness to pay.