Alfie, Bill, and Coco each value police protection differently. Alfie’s demand for the public good is Q = 55 – 5P, Bill’s demand is Q = 80 – 4P, and Coco’s demand is Q = 100 – 10P. If the marginal cost of providing police protection is $13.50, what is the socially optimal level of police provision? Under Lindahl pricing, what share of the tax burden would each of the three people pay?
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