Question is in the pic

3. (15 points) Efficient Public Provision Consider the problem of a small frontier medieval town that is constantly being raided by bandits. Curiously, whenever the bandits attack the town, they rarely damage the properties of the poorer in town as their goal is to simply to steal as much gold as possible; choosing instead to target the merchants and other members of the upper class. Tired of this, a council of the most influential and rich individuals in town decided that it is in the best interest of everyone for the town to collect taxes to finance a big public defense infrastructure project to protect the town from the bandits. Consider that the inverse demand for defense for the rich is given by: P1 = 500 - q and the willingness to pay for the poor is: P2 = 100 - q The cost of building the defenses and maintaining is very high as getting materials delivered to this remote town is very hard. The total cost function is given by: C(q) = 70000 + 100q (a) (5 points) Find the willingness to pay of the society (MSB). (b) (5 points) If the government decided to go ahead with this project. What would be the efficient level of public provision? (c) (5 points) How much will the government have to collect in taxes to pay for the production level you found in part (a)? Is in the best interest of everyone in town to go ahead with this project? (Explain)