Curve 1: Marginal private benefit
Curve 2: Marginal Social benefit
Curve 3: Marginal private cost = Marginal Social cost
Price, Cost 3 P D P4 4 P3 3 C P2 2 B Р. 2 0 21 Q2 Quantity If a positive externality exists then market equilibrium price is P3 P4 OP1 OP2
T А 1 Price, Cost P4 a P3 P2 B Pi Quantity 0 Q1 Q2 If a positive externality exists then the socially optimal price is OP2 OP3 Op4 OP1
Question 6 1 pts 1 Price MC ATC AVC P3 P6 pa P3 P2 P1 Q1 02 03 04 QS Shutdown point is at O p1 Op3 Op4 O p7 Question 7 1 pts Price MC ATC AVC P7 P6 P3 P2 PI Q1 02 03 04 Q3 Quantity Exit point is at Op4 O p1 Op3 O p7
10 In the figure below, what is the size of the externality, and what is the socially optimal quantity? Supply (Private Cost) Social Cost Price Po P. P2 Ps Demand (social value) Q2 Quantity Q3 Q4 a) P1-P3 is the size of the externality, and the socially optimal quantity is Q1. b) P1-P3 is the size of the externality, and the socially optimal quantity is Q2 c) P1-P2 is the size of the externality, and the socially optimal quantity is...
1. The graph below depicts the cost structure for a firm in a competitive market. a. When price rises from P2 to P3, the firm finds that... . Group of answer choices expanding output to Q4 would leave the firm with losses. it could increase profits by lowering output from Q3 to Q2. if it produces at output level Q3 it will earn a positive profit. b.When price falls from P3 to P1, the firm finds that Group of answer...
Figure A-1 Ice Cream S2 Price P2 si P1 w P3 - NT I D 92 q1 Quantity (scoops) Figure A-1 represents the market for ice cream before and after a per scoop tax. What does the area w represent? the resulting loss of producer surplus the resulting loss in consumer and producer surplus the resulting tax revenue generated the resulting consumer surplus generated
Figure 9 Price F D B PI G c - P2 Demand Quantity Q1 02 Refer to Figure 9. Which area represents consumer surplus at a price of P1? a. BDF b. AFG C. ABDG d. ABC Refer to Figure 9. Which area represents consumer surplus at a price of P2? a. BDF b. AFG C. ABDG d. ABC Refer to Figure 9. Which area represents the increase in consumer surplus when the price falls from P1 to P2? a....
P1 P3 A B D C P2 а - b External forces on a bar are as shown in the figure, If P1 = P3 = 15 kN, P2 = 25 kN, and 'x' = 275 mm. Which of the following expressions can correctly evaluate the reaction at B? Select one: A. RB = (25b - 30a + 15d + 8.25) / (b+c) O B. RB = (25b + 30a + 15d + 8.25) / (b+c) O C. RB =...
P1 P2 P3 A | В +d- a b The maximum allowable value of each of the reactions is 250.25. Neglecting the weight of the beam, determine the range of the distance 'd' for which the beam is safe. (Note in this case the reaction for the roller may be positive or negative.) If P1=50 N, P2=75 N, P3=260 N, a=450 mm, b=550 mm. i) d 2 (m, 3 sigfig) = ii) d s (m, 3 sigfig)=
QUESTION6 Figure 6-12 Price ef gasoine S2 S1 P2 price ceilmg 03 Q1 quantity o gaseme Refer to Figure 6-12. When the price ceiling applies in this market, and the supply curve for gasoline shifts from S 1 to S 2 O the market price will increase to P3 O a surplus will occur at the new market price of P2 O the market price will stay at P1 a shortage will occur at the new market price of P2