Question

If Daniella and Vincent are the only members in the community and Daniella values the 5th unit of a public good at $5 and Vincent values the 4th unit of the public good at $8, what is the community's marginal willingness to pay for the 5th unit of the public good

Answer 1

None of the above

Step-by-step explanation:

Marginal willingness to pay (MWTP) is the proclaim amount of money a customers is willing to pay for a specific feature of your product how much your customers are willing to pay for an upgrade feature been added by the manufacturer, after paying for the normal price of the goods. In this case, this no (MWTP) to be paid, since no new features is been added by both Daniella an Vincent.

Answer 2

$5

Step-by-step explanation:

In economics, marginal willingness to pay (MWTP) refers to the amount of money that a consumer is willing to pay for purchasing or consuming a specific product or service. E.g. how much are consumers willing to pay for a higher trim on a car instead of the base model.

Optimally, the MWTP should equal the value given to the product or service offered. In this case, Daniella values the public good at $5, so the community's MWTP should equal $5.