52. (Table: Street Cleanings) Use Table: Street Cleanings. Suppose that the marginal cost of each street cleaning is $18. Which statement is TRUE? Table: Street Cleanings Number of Street Cleanings per Month 0 1 4 5 Peter's Wendy's Total Total Benefit Benefit $0 10 18 24 28 30 $0 8 15 21 26 30 O If Wendy and Peter were the only people in society, the efficient number of street cleanings would be at least two per month. ○ If Wendy and Peter were the only people in society, the efficient number of street cleanings would be one per month. ○ If the city decided to clean the streets only once per month, Wendy would be willing to pay the entire cost of the cleaning. O If the city decided to clean the streets only once per month, Peter would be willing to pay the entire cost of the cleaning.

52. (Table: Street Cleanings) Use Table: Street Cleanings. Suppose that the marginal cost of each street cleaning is $18. Which statement is TRUE? Table: Street Cleanings Number of Street Cleanings per Month 0 1 4 5 Peter's Wendy's Total Total Benefit Benefit $0 10 18 24 28 30 $0 8 15 21 26 30 O If Wendy and Peter were the only people in society, the efficient number of street cleanings would be at least two per month. ○ If Wendy and Peter were the only people in society, the efficient number of street cleanings would be one per month. ○ If the city decided to clean the streets only once per month, Wendy would be willing to pay the entire cost of the cleaning. O If the city decided to clean the streets only once per month, Peter would be willing to pay the entire cost of the cleaning.

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

14
(Figure: The Socially Optimal Quantity of Emissions from Coal Production) Use Figure The Socialy Optimal Quarety of Emissions from Coal Production in the figure, firms are the only beneficiaries of polution, and costs are borne solely by others in the society. Without government intervention Marginal social cost, marginal social benefit MSC of pollution MSB of pollution Quantity of pollution emissions (tons) O The outcome cannot be determined without more information Orms will continue to polute until the marginal benefit to them is $200 O firms will continue to pollute until the marginal benate to them is zero. O the quantity of pollution will be optimal.
5. Property rights and market failures Loggers are much likely to supply wood to the market if property rights are not enforced. In the presence of market failures, public policy can improve economic efficiency. Classify the source of market failure in each case listed. Market Market Failure Power Externality A manufacturing plant dumps chemical waste into a nearby river, poisoning the water supply for a small town downstream. A single grocery store is the only source of food in a small town, giving the store the ability to influence the price of food.
(Table: City Sanitation in Winnetka) Use Table: City Sanitation in Winnetka. Suppose that the marginal cost of each street cleaning is $6. How many street cleanings will there be? Table: City Sanitation in Winnetka Number of Street Cleanings 10 1 2 3 14 QUESTION 29 5 05 03 2 Edwin's Total Benefit Geraldine's Total Benefit $0 10 18 24 28 30 $0 18 15 21 26 30
7. (Market for Pollution Rights) The graph in page 302 shows the market for pollution rights. a. If there are no restrictions on pollution, what amount isdischarged? b. What is the quantity supplied and the quantitydemanded if the government restricts the amount ofdischarge to Q* but gives the permits away? c. Where is market equilibrium if the government sells thepermits at the market-clearing price? Illustrate this on the graph.
Antonio and Caroline are farmers. Each one owns a 20-acre plot of land. The following table shows the amount of alfalfa and barley each farmer can produce per year on a given acre. Each farmer chooses whether to devote all acres to producing alfalfa or barley or to produce alfalfa on some of the land and barley on the rest. Alfalfa Barley (Bushels per acre) (Bushels per acre) Antonio 40 8 Caroline 28 7 ___________has an absolute advantage in the production of alfalfa, and __________ has an absolute advantage in the production of barley. Antonio's opportunity cost of producing 1 bushel of barley is ____ bushels of alfalfa, whereas Caroline's opportunity cost of producing 1 bushel of barley is______ bushels of alfalfa. Because Antonio has a ______ opportunity cost of producing barley than Caroline,________ has a comparative advantage in the production of barley and_______ has a comparative advantage in the production of alfalfa.
6
4 An increase in per capita production and incomes can be expected to have a large effect in reducing emissions that lead to global warming. O false O true
8. Stody Questions and Problems #8 California once proposed legislation that would have required 10% of its car fleet to be nearly emissions-free by the year 2003. This mandate spurred electric vehicle research. Such vehicles could be powered by photovoltaic cells or by batteries that are recharged using an electrical outlet. True or False: Electric vehicles that use electrical outlets are not emissions-free because electric production requires coal, nuclear, or hydroelectric plants, none of which are pollution-free. O True False Electric vehicles that are powered by photovoltaic cells pollution. emissions-free because the manufacturing of PVCs
INTR.27 A city is debating whether or not to build a new park. The city owns the land, having purchased it 50 years ago for $25,000. A local restaurant developer has offered $700,000 for the land. The development costs for the park would be $100,000. What is the minimum amount of the benefits for the park development in order to be rational for the city? a $100,000 b $125,000 c $800,000 d $825,000
4. Externalities - Definition and examples An externality arises when a firm or person engages in an activity that affects the well-being of a third party, yet neither pays nor receives any compensation for that effect. If the impact on the third party is detrimental, it is called a externality. The following graph shows the demand and supply curves for a good with this type of externality. The dashed drop lines on the graph reflect the market equilibrium price and quantity for this good. Shift one of the curves to reflect the presence of the externality. If there are external costs of production, then you should shift the supply curve to reflect the social costs of producing the good; similarly, if there are external benefits from production, then you should shift the demand curve to reflect the social benefits from consuming the good. PRICE (Dollars per unit) QUANTITY (Units) Supply Demand Demand Supply With this type of externality, in the absence of government intervention, the…
6. Correcting for negative externalities - Taxes versus tradable permits Paper factories emit chemicals as a waste product. This generates a cost to society that is not paid for by the firm; therefore, pollution is a negative externality of paper production. Suppose the U.S. government wants to correct this market failure by getting firms to internalize the cost of pollution. To do this, the government can charge firms for pollution rights (the right to emit a given quantity of chemicals). The following graph shows the daily demand for pollution rights. Use the graph input tool to help you answer the following questions. You will not be graded on any changes you make to this graph. Note: Once you enter a value in a white field, the graph and any corresponding amounts in each grey field will change accordingly. PRICE (Dollars per ton) 50 45 40 35 30 25 20 15 10 5 0 0 Demand 50 100 150 200 250 300 350 400 450 500 QUANTITY (Millions of tons) Graph Input Tool Daily Demand for Pollution…