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On a graph, illustrate the market for theater tickets in the case of both externalities operating at the same time. Consider the net response. Label the private and social demand curves, the private and social supply curves, the market equilibrium level of output and the socially optimal level of output. Use the slopes for supply and demand determined from the previous questions. Supply should intersect the origin. Have demand intersect the price axis at a price of $100.

On a graph, illustrate the market for theater tickets in the case of both externalities operating at the same time. Consider the net response. Label the private and social demand curves, the private and social supply curves, the market equilibrium level of output and the socially optimal level of output. Use the slopes for supply and demand determined from the previous questions. Supply should intersect the origin. Have demand intersect the price axis at a price of $100.

Essentials of Economics (MindTap Course List)
Essentials of Economics (MindTap Course List)
8th Edition
ISBN:9781337091992
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter10: Externalities
Section10.1: Externalities And Market Inefficiency
Problem 1QQ
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On a graph, illustrate the market for theater tickets in the case of both externalities operating at the same time. Consider the net response. Label the private and social demand curves, the private and social supply curves, the market equilibrium level of output and the socially optimal level of output. Use the slopes for supply and demand determined from the previous questions. Supply should intersect the origin. Have demand intersect the price axis at a price of $100.
Transcribed Image Text:On a graph, illustrate the market for theater tickets in the case of both externalities operating at the same time. Consider the net response. Label the private and social demand curves, the private and social supply curves, the market equilibrium level of output and the socially optimal level of output. Use the slopes for supply and demand determined from the previous questions. Supply should intersect the origin. Have demand intersect the price axis at a price of $100.
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