Anne, Bruce and Colin each value police protection differently. Anne’s demand for units of the public good is Q = 80-10P; Bruce’s demand is Q = 150 -…

Anne, Bruce and Colin each value police protection differently. Anne’s demand for units of the public good is Q = 80-10P; Bruce’s demand is Q = 150 – 25P; and Colin’s demand is Q = 200 – 20P. If the marginal cost of providing police protection is $20, what is the efficient level of police protection and what would the share of the tax burden for each of them under Lindahl pricing? (PA page 174, Question No 8)6.Two families (A and B) live on a dark street. The local council will provide street lights if the two families are willing to pay for the running costs, which are $30 a month per street light. The demand of the two families for street lights is estimated to be and , where P is the price the family is willing to pay for a street light per month.i.Express the total demand function for street lights.ii.How many street lights 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? (PA, page 174, Q9).

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