Question: SECTION 3: Question 10 is a question on grants and budget constraints. Please show all relevant work, as there is opportunity to get partial credit.

 SECTION 3: Question 10 is a question on grants and budget

constraints. Please show all relevant work, as there is opportunity to get

SECTION 3: Question 10 is a question on grants and budget constraints. Please show all relevant work, as there is opportunity to get partial credit. [8 total points] Question 10 8 pts A city has an initial budget constraint of $2,000 to spend between schools and other services. The initial price ratio of schools to other services is 1:1. The city will always spend their total income. The state will provide a (non-capped) matching grant to the city, where it will provide $1 for every $8 the city spends on schools. The matched money from the matching grant can only be used towards schools. The city wants to end up using a total of $720 for schools (from a combination of what it puts up plus the matching amount from the state). In order to reach this target of $720 for schools, how much should the city spend on other services

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Economics Questions!