Exam 37:Public Goods-Part A

Lucy's utility function is 2X_L +G and Melvin's utility function is X_MG,where G is their expenditures on the public goods they share in their apartment and where X_L and X_M are their respective private consumption expenditures.The total amount they have to spend on private goods and public goods is $33,000.They agree on a Pareto optimal pattern of expenditures in which the amount that is spent on Lucy's private consumption is $9,000.How much do they spent on public goods?

4.8/5

(86)