Price, Cost 9987654321 10 Private Cost Social Cost Demand 12 3 4 5 6 7 8 9 10 Quantity (a) Give a definition of a negative externality and explain how it arises in a market. (b) Refer to the graph above. If the government does not intervene in this market, what is the free market equilibrium? Is it socially efficient? Explain (c) What kind of government intervention is required in this case? Explain how it will change the market outcome

Price, Cost 9987654321 10 Private Cost Social Cost Demand 12 3 4 5 6 7 8 9 10 Quantity (a) Give a definition of a negative externality and explain how it arises in a market. (b) Refer to the graph above. If the government does not intervene in this market, what is the free market equilibrium? Is it socially efficient? Explain (c) What kind of government intervention is required in this case? Explain how it will change the market outcome

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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mcq econ! how to do this?
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Question 21 The following graph presents the marginal cost and marginal benefit information for tons of steel produced. If the external costs are ignored the market equilibrium quantity will be and the market equilibrium price will be a b Ć d 500- 400- 600- 300- 200- 500; 225 700; 195 100- 600; 210 800; 220 0 0 Selected answer will be automatically saved. For keyboard navigation, press up/down arrow keys to select an answer. 200 400 Steel Production 600 800 1000 Tons of Steel Social Marginal Cost Private Marginal Cost Private Marginal Benefit 1200 1400 1600
6a
1. When a production externality has a beneficial effect on a bystander at the market equilibrium a. the market will be efficient b. the social cost of production is less than the private cost c. society is unlikely to benefit from production subsidies d. the private benefit from consumption is less than the social cost of production 2. In the short term, we would expect home construction to have a: a. High elasticity of demand b. Low elasticity of demand c. Low elasticity of supply d. High elasticity of supply 3. Which of the following would be associated with monetary policy operations in response to an economic downturn: a. A shift of the money demand curve to the right. b. A shift of the money supply curve to the right. c. A shift of the money demand curve to the left. d. A shift of the money supply curve to the left. 4. If the government cuts government spending, then over time the government budget deficit: a. will definitely rise b. will definitely fall c. may fall, or…
i need A,B,C subparts