Principles of Microeconomics, 7th Edition

Published by South-Western College
ISBN 10: 128516590X
ISBN 13: 978-1-28516-590-5

Chapter 11 - Part IV - Public Goods and Common Resources - Questions for Review: 3

Answer

*Cost benefit analysis of public goods: comparison between the costs and benefits of implementing public goods. *It is important because the government needs to asses which goods the citizens value the most. *it is hard because you cannot quantify benefit.

Work Step by Step

*Also it is important because governments need to know if benefit exceeds cost. *It is hard because citizens won't tell the truth or won't participate to tell the truth, on how much benefit they got from a good provided to them.
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