Question: 1) Consider the following market for a public good. Jules and Zooey each have a demand curve for the good given by P = 8 - 2Q. This public good can be supplied at a constant price MC=$8
(a) If Jules and Zooey are the only consumers of the public good, what is the market demand function for the good? Show your work.
(b) What is the socially optimal quantity of the public good? Show your work. Is the socially optimal quantity of this good likely to be provided in this market? Carefully justify.