There is a proposal in Essex county to build hiking trails in a nearby reservation. There are two groups of county residents - Group H with 100 residents is willing to pay $30 per resident; Group L also with 100 residents is willing to pay $10 per resident. If the cost of the project is $2,000, will the trails be made? Pick the correct statement. A The trail does not get built although it is efficient. B The trail gets built with contributions from Group H while Group L residents free-ride. C The trail gets built with contributions from both Group H and Group L residents. D The trail gets built with contributions from Group L while Group H residents free-ride.
Given, Group H has 100 occupants who with an eagerness to pay of $30 each.
Hence, all out ability to pay by inhabitants of Group H for the climbing trail = $3000
Correspondingly, Group L has 100 occupants with ability to pay of $10 each.
Hence, all out ability to pay by inhabitants of Group L for the climbing trail = $1000
Since the expense of building the path = $3500, consequently the climbing trail can get assembled just if all the inhabitants of both the Groups H and L are paying their readiness to pay (Total: $4000)
Ans. (C)
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