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4. Congress is allocating $1 million of research funding. It can fund research in surfboard safety, B, or in snowmobile safety, S. Since research is measured in dollars, the price of each good is $1.
The utility of each Californian is

The utility of all other Americans is

a. To make this decision, Congress uses the social welfare function

What is the optimal allocation?

b. Suppose that Congress agrees to a compromise: the Rawlsian social welfare function will be used, so that research will be allocated to maximize

What is the optimal allocation?

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The social welfare function is incorporated. The optimal allocation is provided.

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4. Congress is allocating $1 million of research funding. It can fund research in surfboard safety, B, or in snowmobile safety, S. Since research is measured in dollars, the price of each good is $1.
The utility of each Californian is

The utility of all other Americans is

a. To make this decision, Congress uses the social welfare function

What is the ...

Purchase this Solution
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