Answered: P = 16-.25Q MC = 2+.25Q Production…

P = 16-.25Q MC = 2+.25Q Production creates an external benefit equal to $2 per unit. What is the socially optimal level of output? O 10 24 O 28 32

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

P = 16-.25Q
MC = 2 + .25Q
Production creates an external benefit equal to $2 per unit.
What is the socially optimal level of output?
10
24
28
32

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