If the cost of the fireworks display is divided equally


Fireworks as Public Goods. A three-person city is considering a fireworks display. Bertha is willing to pay $100 for the proposed fireworks display, Marian is willing to pay $30, and Sam is willing to pay $20. The cost of the fireworks display is $120.

a. Will any single citizen provide the display on his or her own?

b. If the cost of the fireworks display is divided equally among the citizens, will a majority vote be in favor of the display?

c. Describe a transaction that would benefit all three citizens.

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Econometrics: If the cost of the fireworks display is divided equally
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