QUESTION 1 Consider the market for fast food. Suppose the demand for fast food is given by QD=6-P where P is the price of an item (a burger, say) in dollars. Also suppose the supply is given by QS=P. The equilibrium price in this market is The equilibrium quantity of fast food is Fast food produces a lot of waste in all of the packaging that goes along with it when taken to go. This waste produces negative externalities - the private cost of consuming fast food (it's price) is less than the marginal social cost, which includes the cost of having to dispose of the waste. Suppose that the additional cost to society from each item of fast food produced is 0.5 dollars. In this case, the socially efficient quantity of fast food is
QUESTION 1 Consider the market for fast food. Suppose the demand for fast food is given by QD=6-P where P is the price of an item (a burger, say) in dollars. Also suppose the supply is given by QS=P. The equilibrium price in this market is The equilibrium quantity of fast food is Fast food produces a lot of waste in all of the packaging that goes along with it when taken to go. This waste produces negative externalities - the private cost of consuming fast food (it's price) is less than the marginal social cost, which includes the cost of having to dispose of the waste. Suppose that the additional cost to society from each item of fast food produced is 0.5 dollars. In this case, the socially efficient quantity of fast food is
Chapter1: Making Economics Decisions
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![**Question 1**
Consider the market for fast food. Suppose the demand for fast food is given by \( Q_D = 6 - P \) where \( P \) is the price of an item (a burger, say) in dollars. Also, suppose the supply is given by \( Q_S = P \).
- The equilibrium price in this market is [Dropdown].
- The equilibrium quantity of fast food is [Dropdown].
Fast food produces a lot of waste in all of the packaging that goes along with it when taken to go. This waste produces negative externalities—the private cost of consuming fast food (its price) is less than the marginal social cost, which includes the cost of having to dispose of the waste.
Suppose that the additional cost to society from each item of fast food produced is 0.5 dollars. In this case, the socially efficient quantity of fast food is [Dropdown].](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F8fec5f0b-3332-4e83-8b1c-3dcc90cc5025%2F81b79df4-5581-4d3c-a5b5-998aee1d5208%2Fviwhd2j_processed.png&w=3840&q=75)
Transcribed Image Text:**Question 1**
Consider the market for fast food. Suppose the demand for fast food is given by \( Q_D = 6 - P \) where \( P \) is the price of an item (a burger, say) in dollars. Also, suppose the supply is given by \( Q_S = P \).
- The equilibrium price in this market is [Dropdown].
- The equilibrium quantity of fast food is [Dropdown].
Fast food produces a lot of waste in all of the packaging that goes along with it when taken to go. This waste produces negative externalities—the private cost of consuming fast food (its price) is less than the marginal social cost, which includes the cost of having to dispose of the waste.
Suppose that the additional cost to society from each item of fast food produced is 0.5 dollars. In this case, the socially efficient quantity of fast food is [Dropdown].
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