Here, we try to model the welfare implications of the statement "when the producers of fossil fuels don't bear the cost of the damage their emissions of greenhouse cour go to the fakt be the quantity of falls and Pits price. Assume that the social curves (where re Intersect at the indicated points on the previous graphs For example, if the social value is above the private value, the social value crosses the private cost curve at 33. Price (1. P1 2. P23. P34. None of the options) and quantity (1.12.23.34.f the f the options) Under the scenario described in the statement this equilibrium would lead to a deadweight loss equal to the orange area in the (1. Top left 2. Top right 3. Bottom lett 4. Bottom right 5. none of the options) p The socially optimal quantity is (1.12.23. 34. None of the above). The article argues that to internalize the externality fully, the government could (1. Tax: 2. Subsidize 3. Neither tax or b) this market by an amount equal to (1. P12. F23.3-p 24. None of the options). Under the policy, the price paid by the pulse (1.12.23.34. None of the above) such that the consumer surplus would now be given by the area (1.42. B+ (3.D 4. None of the above), while the price received by the sellers would be (1. P12. P23. P34. None of the options) such that the producer's surplus would now be given by the area (1.A 2.B+C3.D4. None of the options). Such a tax exemplifies (1.Command and control 2. Market baded) government policy that (1. Increases 2. Decreases 3. Neither increases nor decreases) total welfare A p3 B p2--- C - H; Demand (private value) p1 D - Supply (private cost) E 91 q2 q3 Demand (private value) Supply (private cost)
Here, we try to model the welfare implications of the statement "when the producers of fossil fuels don't bear the cost of the damage their emissions of greenhouse cour go to the fakt be the quantity of falls and Pits price. Assume that the social curves (where re Intersect at the indicated points on the previous graphs For example, if the social value is above the private value, the social value crosses the private cost curve at 33. Price (1. P1 2. P23. P34. None of the options) and quantity (1.12.23.34.f the f the options) Under the scenario described in the statement this equilibrium would lead to a deadweight loss equal to the orange area in the (1. Top left 2. Top right 3. Bottom lett 4. Bottom right 5. none of the options) p The socially optimal quantity is (1.12.23. 34. None of the above). The article argues that to internalize the externality fully, the government could (1. Tax: 2. Subsidize 3. Neither tax or b) this market by an amount equal to (1. P12. F23.3-p 24. None of the options). Under the policy, the price paid by the pulse (1.12.23.34. None of the above) such that the consumer surplus would now be given by the area (1.42. B+ (3.D 4. None of the above), while the price received by the sellers would be (1. P12. P23. P34. None of the options) such that the producer's surplus would now be given by the area (1.A 2.B+C3.D4. None of the options). Such a tax exemplifies (1.Command and control 2. Market baded) government policy that (1. Increases 2. Decreases 3. Neither increases nor decreases) total welfare A p3 B p2--- C - H; Demand (private value) p1 D - Supply (private cost) E 91 q2 q3 Demand (private value) Supply (private cost)
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question
Transcribed Image Text:Here, we try to model the welfare implications of the
statement "when the producers of fossil fuels don't bear
the cost of the damage their emissions of greenhouse
cour
go to the
fakt be the quantity of falls and Pits
price. Assume that the social curves (where re
Intersect at the indicated points on the previous graphs
For example, if the social value is above the private
value, the social value crosses the private cost curve at
33. Price (1. P1 2. P23. P34. None of the
options) and quantity (1.12.23.34.f
the f
the options)
Under the scenario described in the statement
this equilibrium would lead to a deadweight loss equal
to the orange area in the (1. Top left 2. Top right 3.
Bottom lett 4. Bottom right 5. none of the options) p
The socially optimal quantity is (1.12.23.
34. None of the above). The article argues that to
internalize the externality fully, the government could
(1. Tax: 2. Subsidize 3. Neither tax or b) this
market by an amount equal to (1. P12. F23.3-p
24. None of the options). Under the policy, the price
paid by the pulse (1.12.23.34.
None of the above) such that the consumer surplus
would now be given by the area (1.42. B+ (3.D
4. None of the above), while the price received by the
sellers would be (1. P12. P23. P34. None of the
options) such that the producer's surplus would now
be given by the area (1.A 2.B+C3.D4. None of
the options). Such a tax exemplifies (1.Command
and control 2. Market baded) government policy that
(1. Increases 2. Decreases 3. Neither increases nor
decreases) total welfare
Transcribed Image Text:A
p3
B
p2---
C
-
H;
Demand (private value)
p1
D
-
Supply (private cost)
E
91
q2 q3
Demand (private value)
Supply (private cost)
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