1. PA - PC
Externality = vertical difference between the supply curves
2. The price is PB and tge quantity is QA
Socially efficient equilibrium reaches at the intersection of D and S1 curves
The graph blow represents a negative externality in the market for oil. What is the per...
The graph blow represents a negative externality in the market
for oil. What is the per unit value of the externality?
A. Pa-Pc
B. Pb-Pc
C. Pa
D. Pb
E. Pa-Pb
P S So PA PB PC D ад ав Q
In the graph below, what is the price and quantity produced by the firm in a competitive market? a. Pa & Qa b. Pa & Qb c. Pb & Qa d. Pc & Qb e. None of the above. Price MRİ Q, Quantity
No Spacing Title 7. The following graph represents a market with an externality Assume there is no government Intervention. (6 pts.) Price $450 $350 $300 a. Is this an example of a negative or positive externality? What quantity will be produced in the market? What price will the market sell each unt? d. Calculate the extem benefit per unit at the quantity that that is being produced in the market .. What is the officent quantity to produce # Using...
The following graph represents a market with an externality. Assume there is no government intervention. (6 pts.) 8. Price MSC $210 МPC $200 $197 D MSB Quantity 500 600 700 Is this an example of a negative or positive externality? a. b. What quantity will be produced in the market? What price will the market sell each unit? C. Calculate the external cost per unit at the quantity that that is being produced in the market d. What is the...
In the graph below, what is the price and quantity produced by the firm in an imperfectly competitive market? a. Pa & Qa b. Pa & Qb c. Pc & Qa d. Pd & Qc e. Pe & Qb Price MRİ Q, Quantity
10. (8 points) Consider the following graph depicting the competitive market for oil. Price of Oil ($) Demand - - Supply ***** Social Cost 0 1 10 11 2 3 4 5 6 7 8 9 Quantity Oil (millions of barrels) a. In a free market with no restrictions, what is the equilibrium quantity and price of oil? b. Why does the above graph indicate that there is an externality associated with producing oil? What is the value of the...
Suppose that there is a positive externality in the market for pizza rolls. The graph below shows the supply and demand curves for pizza rol 144 13+ MSB) Price of pizza rolls 1 2 3 4 5 6 7 8 Quantity of pizza rolls 9 10 11 12 13 14 4. What is the market equilibrium? 5. What is the market price? 6. What is the optimal quantity? 7. What should the government do in order to ensure the market...
Suppose we have a market with a negative externality. Market demand is Q = 18 - P The private cost is Cp(Q) = Q and the cost of the externality is CzQ) = Q?. a. What is the marginal cost of the externality, MCg? b. What is the marginal cost to society of production MCs? c. What is the Socially Optimal quantity and price? d. Suppose the government wanted to tax a monopoly in this market with a negative externality....
Suppose the figure to the right illustrates the market for toilet paper, where S, represents the marginal private cost of production and D, represents the marginal private benefit from consumption Companies that produce toilet paper bleach the paper to make it white. Some paper plants discharge the bleach into rivers and Lakes, causing substantial environmental damage. Assume that Sy represents the marginal social cost of producing toilet paper incorporating the externality). What could the government de to internalize the externality?...
Suppose the figure to the right illustrates the market for toilet paper, where S, represents the marginal private cost of production and D, represents the marginal private benefit from consumption Companies that produce toilet paper bleach the paper to make it white. Some paper plants discharge the bleach into rivers and Lakes, causing substantial environmental damage. Assume that Sy represents the marginal social cost of producing toilet paper incorporating the externality). What could the government de to internalize the externality?...