**Understanding Deadweight Loss Due to Pollution from Dry Cleaners***Question 43*: The fumes from dry cleaners contribute to air pollution. The deadweight loss associated with the private market equilibrium (assuming linearity) is:**Graph Explanation**:The graph plots the price per item (y-axis) against the quantity of items cleaned per week (x-axis). Three curves are represented:1. **Marginal Social Cost (MSC)**: This curve shows the cost to society, which includes the external costs of air pollution. It is higher than the Marginal Private Cost.2. **Marginal Private Cost (MPC)**: This curve represents the cost incurred by the dry cleaners, excluding the external costs of pollution.3. **Marginal Social Benefit (MSB)**: Reflects the benefit to society from cleaning items, equivalent to the demand curve.**Key Points Referenced**:- **Price Points**: $7.50, $7.25, and $7.15 are marked on the price axis.- **Quantity**: At 600,000 and 750,000 items cleaned per week are specific quantities referenced.**Options** for the deadweight loss:a. $70,000b. $35,000c. $52,500d. $26,250e. none of the above

A negative externality refers to a situation where the production or consumption of a certain good…

43. The fumes from dry cleaners contributes to air pollution. The deadweight loss associated with the private market equilibrium (assuming linearity) is: PRICE $/ITEM $7.50 $7.25 $7.15 a. $70,000 b. $35,000 c. $52,500 d. $26,250 e. none of the above 600,000 750,000 S=MARGINAL SOCIAL COST S= MARGINAL PRIVATE COST D= MARGINAL SOCIAL BENEFIT QUANTITY OF ITEMS CLEANED/WEEK

43. The fumes from dry cleaners contributes to air pollution. The deadweight loss associated with the private market equilibrium (assuming linearity) is: PRICE $/ITEM $7.50 $7.25 $7.15 a. $70,000 b. $35,000 c. $52,500 d. $26,250 e. none of the above 600,000 750,000 S=MARGINAL SOCIAL COST S= MARGINAL PRIVATE COST D= MARGINAL SOCIAL BENEFIT QUANTITY OF ITEMS CLEANED/WEEK

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

How to set the Pigouvian Taxes to correct the problem with negative externalities? Eliminate the divergence between ... Mark all that applies. Group of answer choices the marginal social cost and marginal private cost at the socially optimal level of consumption. the polluter’s private benefit and social benefit. the average social cost and average private costs. input costs and output prices at the market equilibrium. the marginal social cost and marginal private cost at the market equilibrium.
7.
Only typed answer You are an industry analyst that specializes in an industry where the market inverse demand is P = 100 - 3Q. The external marginal cost of producing the product is MCExternal = 6Q, and the internal cost is MCInternal = 14Q. Instruction: Round your answers to the nearest two decimal places. a. What is the socially efficient level of output? units b. Given these costs and market demand, how much output would a competitive industry produce? units c. Given these costs and market demand, how much output would a monopolist produce? units d. Which of the following are actions the government could take to induce firms in this industry to produce the socially efficient level of output. Instructions: You may select more than one answer. Click the box with a check mark for the correct answers and click twice to empty the box for the wrong answers. You must click to select or deselect each option in order to receive full credit. Pollution taxes…
2. If private supply is P=100+0.80 and social demand is P=10-0.2Q, MEB=0 and MEC is 0.10: Obtain the private and social equilibrium. b. If consumers have the rights, how much should be paid to them by the firm? c. If producers have the rights to pollute, how much would recreational users be willing to pay to obtain an efficient outcome? a.
Price (dollars per unit) PA P3 P₂ P₁ 0 MSC Figure 16.2.1 MC Q₂ Quantity (units per day) 72) Refer to Figure 16.2.1. The figure shows the marginal private cost curve, the marginal social cost curve and the market demand curve. If the market is unregulated, then A) the externality is eliminated. B) the quantity produced is greater than the efficient quantity. C) the quantity produced is less than the efficient quantity. D) the quantity produced is efficient but price is too low. E) the quantity produced is efficient but the price is too high.
Q5 Homework • Unanswered Given these two individual demand curves, what is the equation for the market demand curve for a private good? i. P=200 - 10Q ii. P=200 - (20/3)Q Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer. a P= 200 - 4Q P=200 - 8.33Q P = 100 - 8.33Q d. P = 100 - 1.67Q Unanswered A Submit
1. In this market, how much is the external cost from the production of each unit of tobacco? To reach the social optimum, should the government provide a subsidy or impose a tax? If so, how much tax or subsidy? 2. Is there a deadweight loss in this market? If so, why is there a deadweight loss?
None
The production of fabric generates toxic effluents related to the dyes used. This is typically disposed of with wastewater, which generates pollution. If the government does not intervene, the market for fabric has an equilibrium price of $250 per roll and an equilibrium quantity of 10,000 rolls. a.How would the socially optimal quantity of fabric compare to the free market equilibrium quantity of 10,000 rolls? Why? b. Using a supply and demand graph show the effect on social welfare of allowing the market for fabric to operate without government intervention. Label all the curves and relevant points on your graph. c. Would a government subsidy or tax help the market achieve the social optimum? Explain. Show the necessary subsidy/tax on your graph. d. Explain how this intervention helps achieve the social optimum and what information would be necessary to implement it.
Kindly assist with question 7.
2. Refer to Graph 10-1. Assume the externality is not internalised. What is the loss to society from the last unit of the good produced by the market? A. P3-P2 B. P2-P1 C. P3-P1 D. ZeroGraph 10-1 Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.
Use your demand schedule for a public good, determined in question 1, and the following supply schedule to ascertain the optimal quantity of this public good. Why is this the optimal quantity?