Question

Categories of goods Complete the following table by selecting the appropriate definition for eich of the given terms. If a good is both excludable and nontival in consumption, then it is 3. Voluntary contributions toward a public good Dmitri and Jake are consldering contributing toward the creation of a building mural. Each can choose whether to contribute $400 to the bullding mural or to keep that $400 for a weekend getaway. Since a building mural is a public good, both Dmitri and lake will benefit from any contributions made by the other person. Specifically, every dollar that either one of them contributes will bring each of them $0.80 of benefit. For example, if both Dmitri and lake choose to contribute, then a total of $800 would be contributed to the building mural. 50, Dmitri and Jake would each receive $640 of benefit from the building mural, and their combined benefit would be $1,280. This is shown in the upper left cell of the first table. Since a weekend getaway is a private good, if Dmitri chooses to spend $400 on a weekend getaway, Dmitri would get $400 of benefit from the weekend oetaway and Jake wouldn't receive any benefit frorn Dmitri's choice. If Dmitri still spends $400 on a weekend getaway and Jake chooses to contribute $400 to the building mural, Dmitri would still receive the $320 of benefit from Jake's generosity. In other words, if Dmitri decides to keep the $400 for a weekend getaway and Jake decides to contribute the $400 to the public project, then Dmitri would roceive a total benefit of $400+$320=$720, Jake would receive a total benefit of $320, and their combined benefit would be $1,040. This is shown in the lewer left cell of the first table. Complete the following table, which shows the combined benefits of Dmtri and Jake as previously described. of the four cells of the table, which gives the greatest combined benefits to Dmitri and lake? When both Dmitri and Jake contribute to the building mural When Dmitri contributes to the building mural and lake doesn't, or vice versa When neither Dmitri nor Jake contributes to the building mural

Answer 1

A public good is a good that is nonexcludable and non-rival. In the given scenario, both Dmitri and Jake will benefit from the contributions made by the other person to the building mural.

Step-by-step explanation:

A public good is a good that is nonexcludable and non-rival. Nonexcludable means that it is difficult or costly to prevent someone from using the good, and non-rival means that one person's use of the good does not diminish its availability to others. An example of a public good is national defense, which protects everyone and cannot exclude anyone from its benefits.

In the given scenario, the creation of a building mural is considered a public good. Both Dmitri and Jake will benefit from the contributions made by the other person because the mural is nonexcludable and non-rival. Their combined benefit is maximized when both of them contribute to the building mural, as shown in the upper left cell of the table.