[20 points total] A city has three equally sized groups of people: avid hikers, casual hikers, and non- hikers. Each group's marginal benet of hiking trails, measured in dollars per mile of trail, is given by MBAm-d = 1000 20Q, MBCasual = 4'00 _ 8Q; MBNon : 0; where Q is the miles of trails in the city's parks. Hiking trails are an example of a pure public good that is both nonrival and nonexcludable. Each mile of trail costs $630 to construct (i.e., MC = 630). [2 points] How many miles of trail will the avid hikers pay for if they pay the entire marginal cost of $630 and only consider their own benet? . [4 points] The casual hikers have no private incentive to pay $630 for additional miles, especially since they can free ride off the avid hikers' expenditures. In contrast to that inefcient equilibrium, how many miles of hiking trails are economically efcient? [4 points] In a single diagram, with quantity on the Xaxis and price on the y-axis, show your answers from parts a and I). Also, show the deadweight loss associated with the inefcient outcome |' -. _ a [1. 5'40 PM I E: I. u l' 11-26-2020