People in a community are voting on how much of a public good should be provided

Question

People in a community are voting on how much of a public good should be provided. Assuming that each person casts a truthful vote, which tax structure is most likely to yield the socially efficient quantity?

a) None of the other answers is correct.

b) The Coase Theorem says that all of these will yield the same result.

c) Each person pays a tax equal to her MPB at the socially optimum level.

d) Each person pays an equal share of the total cost of the project.

e) Each person pays an amount based on her income.

Explanation / Answer

Each person pays an amount based on her income. this is the most likely to yield the efficient quqantity.which increase the equal distribution of income.

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