Multiple Choice
Suppose that Steve and Susie each perceive $200 of marginal benefit from a proposed new park, whereas Elizabeth perceives $800. If the proposed tax levied on each for the park would be $300, a majority vote will
A) defeat this project and resources will be underallocated to it.
B) defeat this project and resources will be efficiently allocated.
C) pass this project and resources will be underallocated to it.
D) pass this project and resources will be overallocated to it.
Correct Answer:
Verified
Correct Answer:
Verified
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