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4. Consider a community with 80 vacant parcels. The value of developed parcels can be represented by V-80-X, where V is measured in 1000s of $. X represents the number of developed parcels. Each parcel costs 10,000 (C=10) to prepare for development. The social value of undeveloped parcels can be represented by the function U-10+X, where U is also measured in 1000s of $. What is the efficient number of developed parcels? How many parcels will be developed if each parcel is owned by a separate individual, maximizing their own profits?

4. Consider a community with 80 vacant parcels. The value of developed parcels can be represented by V-80-X, where V is measured in 1000s of $. X represents the number of developed parcels. Each parcel costs 10,000 (C=10) to prepare for development. The social value of undeveloped parcels can be represented by the function U-10+X, where U is also measured in 1000s of $. What is the efficient number of developed parcels? How many parcels will be developed if each parcel is owned by a separate individual, maximizing their own profits?

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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4. Consider a community with 80 vacant parcels. The value of developed parcels can be represented by V-80-X, where V is measured in 1000s of $. X represents the number of developed parcels. Each parcel costs 10,000 (C=10) to prepare for development. The social value of undeveloped parcels can be represented by the function U=10+X, where U is also measured in 1000s of $. What is the efficient number of developed parcels? How many parcels will be developed if each parcel is owned by a separate individual, maximizing their own profits?
Transcribed Image Text:4. Consider a community with 80 vacant parcels. The value of developed parcels can be represented by V-80-X, where V is measured in 1000s of $. X represents the number of developed parcels. Each parcel costs 10,000 (C=10) to prepare for development. The social value of undeveloped parcels can be represented by the function U=10+X, where U is also measured in 1000s of $. What is the efficient number of developed parcels? How many parcels will be developed if each parcel is owned by a separate individual, maximizing their own profits?
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