What lindahl prices would each individual pay

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There are four individuals I , II, III and IV in a society with a demand for the public good given by Q = 100 – P, Q = 300 – P, Q = 400 – P and Q = 150 - P respectively. If the marginal cost of providing the public good is constant and is equal to $750, then what is the Lindahl equilibrium and the socially optimum level of public good? Under Lindahl pricing, what Lindahl prices (or benefit tax) would each individual pay? b) The preference revelation problem associated with Lindahl pricing becomes more severe as the number of people in s ociety increases. Why do you think this is true?

Reference no: EM131107837

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