Skiers per day The diagram above shows the daily market for water skiing permits on El Dorado Lake. Suppose each skier (each permit) causes $2 of damage to the lake. What is the socially optimum number of skiers on the lake each day?

Skiers per day The diagram above shows the daily market for water skiing permits on El Dorado Lake. Suppose each skier (each permit) causes $2 of damage to the lake. What is the socially optimum number of skiers on the lake each day?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Related questions

Q: Suppose a public garden is always busy. We could expect park is people using the park since the…

A: Public goods are those goods which are freely available on the market and whose use does not affect…

Q: What is the value of the tax? B. Calculate Pigouvian tax revenue

Q: 1. Road construction is going on Riccarton Road. 100 Uber drivers want to drop their passengers at…

A: Driver's payoff is assumed to be his/ her profit (income - cost of travelling, including travel…

Q: Pls answer very fast.I ll upvote. Thank You The figure below shows the market for water-skiing…

A: A negative externality refers to the unintended cost or impact imposed on third parties or society…

Q: During the COVID-19 pandemic, alcohol consumption increased dramatically. In response, the…

A: The objective of the question is to understand the impact of a tax on a good with inelastic demand…

Q: 5 ranchers use a grassland to feed their cows. The ranchers must choose how many cows to raise. The…

A: The Nash equilibrium refers to the situation where firms independently choose their production…

Q: 5 ranchers use a grassland to feed their cows. The ranchers must choose how many cows to raise. The…

A: 5 ranchers use a grassland to feed their cows. The ranchers must choose how many cows to raise. The…

Q: Consider a small town with a factory that produces cell phones. The factory's production causes air…

A: Negative externalities arise when the use or production of a product or service causes harm to a…

Q: *: * Suppose 15 people each have the demand Q = 220 – 40P for streetlights, and 10 people ve the…

A: There are 15 people each have the following demand: Q = 220 - 40P => P = (220 -Q) / 40…

Q: Now suppose that the government has to intervene in the production of the good (rice) for there is a…

A: The economies around the globe are involved in the economic, and the financial activities. The…

Q: The demand for clean streets in a neighborhood is Q = 125 – P. For each of the following questions,…

A: The demand for the cleans streets in a neighbourhood: Q = 125-P or P = 125 – Q Where P is the price…

Q: Could you help me to compute the social optimum quantity of roses and the DWL in the competitive…

A: In the given question, The marginal cost (MC) of the producing roses is given as; MC = 30+2R and the…

Q: 1. The farmer takes the rancher to court and the judge decides putting up a fence is the farmer's…

A: An externality is an idea from economics that alludes to the unintended side impacts or consequences…

Q: The good produced emits toxic waste to a nearby river. Eco nists ēs mate thi: unintended consequence…

A: “Since you have posted a question with multiple sub-parts, we will solve first three sub-parts for…

Q: 3. Total Revenue and Elasticity of Demand. Suppose the demand for buko pie in Los Baños is given to…

A: Disclaimer :- since you have asked multipart questions we are solving only the first 3 parts as per…

Q: Do not use Ai

A: Note: In this question, the graph is missing. I am attaching a graph that depicts the situation…

Q: 3 ranchers use a grassland to feed their cows. The ranchers must choose how many cows to raise. The…

A: Social externalities refer to the indirect impacts, whether positive or negative, that a rancher's…

Q: Suppose a consumer consumes a carbon-intensive good and a carbon-neutral good. Using a diagram, show…

A: A carbon tax program that is viewed as unfair has a lower chance of passing and staying in place.…

Q: There are 9 people with the following marginal willingness to pay schedules for levels of…

A: Given, Two people with the same marginal WTP=$20-Q. Three people with the same marginal WTP= $10-Q.…

Q: In the past, some counties and countries have imposed taxes on sugar, saturated fats, and food made…

A: As the milk chocolates includes huge sugar content which can lead to some health related issues. And…

Q: What challenges do economies face in light of optimal allocation and public goods

A: For the most part, the public money idea manages the ideal distribution of assets involving it for…

Q: If there are no externalities or market power and all markets are in equilibrium, what conclusions…

A: The Market equilibrium occurs where the demand and supply forces are equal. The presence of market…

Q: What is the socially optimal outcome?

A: Lets analyze the question.

Q: 1. A company decides to eliminate the pollution it was causing. The result was a "socially efficient…

A: Factors of production are the components used for the process of manufacturing the goods and…

Q: A. Determine whether it is socially optimal for Taylor to rehearse in the dorm. B. If UP policy…

A: The singing rehearsals in the dorm of student C save student T from paying Php 500 per hour on…

Q: Questions 12 & 13 relate to the following graph: $ P3 ď P₂ P₁ 12 The graph best represents: 13 Ở Qo…

A: "An externality represents a benefit or a cost generated by a producer or consumer and is not…

Q: 3 ranchers use a grassland to feed their cows. The ranchers must choose how many cows to raise. The…

A: Social externalities refer to the indirect impacts, whether positive or negative, that a rancher's…

Q: True or false and use a graph to explain: the socially optimal level of pollution is zero.

A: By matching the marginal cost of new pollution with the marginal benefit, the amount of pollution…

Q: Draw a graph with pollution abatement on the horizontal axis (assume a firm can remove up to 100…

A: Pollution abatements are technologies used by industries or firms to reduce the impact of their…

Q: Curve S, embodies all costs (including externalities) and D, embodies all benefits. (including…

A: The study and evaluation of corporate financial concerns using abstract economic principles and…

Q: Suppose that flu shots create a positive externality equal to $10 per shot. Further suppose that the…

A: Externality refers to spill-over effect of a good on third party which is not involved in either…

Q: The diagram to the right depicts the market for cough medicine in a small town. The quantity of…

A: In a market, when an activity has a positive impact on society, it will increase social marginal…

Q: chemical factory emits waste products into a river. The waste products affect a fishery downstream.…

A: Marginal damage (MD) is the damage caused to the fishery by each additional emission done by the…

Q: Use a graph to illustrate the quantity of pollution that would be emitted (a) after a corrective tax…

A: Suppose Demand for pollution is P=30-Q, If a tax of $10 per unit is set, the optimal amount of…

Q: Which statement is a positive externality? O Edwin has dozens of dogs that dig holes in your yard to…

A: Positive externality refers to a benefit that is obtained by third parties from the production or…

Q: A. Suppose the demand and supply for the market of cigarettes in a city is given by QD = 400-50P, Qs…

A: Disclaimer:- since you asked multiple questions we are solving the 1st questions as per guidelines.…

Q: Pls answer very fast.I ll upvote. Thank You The figure below shows the market for water-skiing…

A: A negative externality refers to the unintended cost or impact imposed on third parties or society…

Question

Price of ski permits
$ 10.00
$ 9.00
$ 8.00
$ 7.00
$ 6.00
$ 5.00
$ 4.00
$ 3.00
$ 2.00
$ 1.00
$ 0.00
5 10 15
20 25 30 35 40 45 50
Skiers per day
The diagram above shows the daily market for water skiing permits on El Dorado Lake. Suppose each skier (each permit) causes $2 of damage to the lake. What is the socially optimum number of skiers
on the lake each day?

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1: Supply curve

VIEW

Step 2: Social optimum number of skiers

VIEW

Solution

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 3 steps with 1 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

Use a supply and demand graph to show a good which should be illegal owing to it's negative externality.
A local school administrator observes an increase in the number of flu cases in the public schools over the last two years. She is concerned that some families cannot afford flu vaccine and are therefore not having children vaccinated. She is also concerned that the failure to vaccinate some children is putting other children at risk, so she proposes that the state subsidize vaccines to increase coverage rates. a. Determine whether the failure to vaccinate some children is an external benefit or an external cost. If an external cost is present, move point A and point B to show the marginal social cost curve. If an external benefit is present, move point A and point B to show the marginal social benefit curve. Place point C at the equilibrium outcome. Place point D at the socially optimal outcome. Flu vaccines A B D Supply (marginal private cost) Price
Ben produces chemical compounds that sell for $500 in the market. This production process generates waste which Ben can dispose of in the river for free, or he can pay $300 for professional waste disposal services. The river is also used by swimmers and fishermen, who value having a clean river at $120 and $190 each. Assume there are no negotiation or transaction costs. a) What is the socially optimal outcome in this situation?
The following graph represents the market for high-emissions cars. Answer this question assuming that the externality is not internalised. Which quantity is socially optimal (i.e. what is the efficient quantity)? What is the deadweight loss generated by the externality?
Address the question in the image.
Give an example of a positive externality and an example of a negative externality that exist in the economy? Share your thoughts in a paragraph
what is an externality? give an example of a postiive externality and an example of negative externality
Assume that to balance the benefits of providing electricity with its pollution costs, A. Treehugger recommends that the government imposes a tax $0.04 for every kilowatt hour (kWh) of electricity sold. If they do, how much of this tax is actually paid by the customer (consumer’s burden) and how much is paid by the firm (producer’s burden)?
C. How would you calculate: (1) the total amount of subsidy incurred by the government to socially efficient allocate?
Y10
The equations below represent the demand and supply curves for annual gym memberships in a city. qD= 500 − 2p, qS=0.5p − 50 Because physical activity leads to better health, the city estimates that each annual gym membership saves $30 of public spending on healthcare per year (a positive externality). a. In a graph, show the market and the socially optimal equilibria for annual gym memberships in this city. Does the market equilibrium result in under- or over-consumption of memberships? What is the deadweight loss associated with the market failure in this situation? b. Would you recommend this city to implement a subsidy (a negative Pigouvian tax) to correct this market failure? If so, how much would be the subsidy per unit? What would be the effects of your proposed policy on the quantity, price, and aggregate welfare?
There are two fishermen, Zach and Jacob. They would each benefit if lighthouses were built along the coast where they fish. The marginal cost of building a lighthouse is $100. The marginal benefit that Zach gets from each lighthouse is 90 - Q, where Q is the number of lighthouses. The marginal benefit that Jacob gets from each lighthouse is 40 - Q. 1. What is the efficient number of lighthouses? 2. What is Zach's marginal benefit of lighthouses at the efficient quantity? 3. Would Zach have been willing to pay for the last additional lighthouse at the efficient quantity? a) Yes b) No