Some economists claim that early child care generates an external benefit to society. Use the below graphto answer the following questions.Price($ per month)Supply1,3001,2001,000900Marginal Social Benefit1.Marginal Private Benefit2326Quantity(millions per month)What is the market equilibrium? What is the socially optimal outcome? How do they differ?a.b.The government is planning to provide a per-unit subsidy for child care to achieve the socially optimaloutcome. How large should this subsidy be?с.How much is the total government subsidy each month to reach a socially optimal outcome?

The externality is said to be created when an individual or a firm produces or consumes a good that…

Answered: Some economists claim that early child…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Similar questions

Suppose there are two residents in a neighborhood, and you know both of their demand curves for a public good. What would you have to do in order to figure out what the social demand curve? A.Multiply the two demand curves together B.Add their demand curves together C.Subtract the demand of the person with the lower valuation of the public good from the demand of the person with the higher valuation of the public good D.Subtract the demand of the person with the higher valuation of the public good from the demand of the person with the lower valuation of the public good
Identify a type of market failure. Provide an example of that type of market failure and briefly explain one way that the government could help reduce the negative effect of that market failure.
Externalities Do you think that there would be external effects associated with Water from a uranium mine leaking into Kakadu National Park? If so, what would be the nature of the external effects? Can you think of policies that might deal with each external effect (that is, improve social wellbeing)?
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.
Explain why there are no markets for public goods briefly.
What exactly is a Pigovian tax? Give some instances of how the Pigovian tax can be used to tackle environmental issues.
subject:eco
Assume that to balance the benefits of providing electricity with its pollution costs, A. Treehugger recommends that the government imposes a tax $0.04 for every kilowatt hour (kWh) of electricity sold. If they do, how much of this tax is actually paid by the customer (consumer’s burden) and how much is paid by the firm (producer’s burden)?
Suppose there are only two consumers in the market for a public good. The figure to the right shows marginal benefit lines for a public good for the two individuals, Andrew (A) and Brenda (B). Use the line drawing tool to draw and label the social marginal benefit line. Make sure that the line extends from quantity level 0 to 10 as the private marginal benefit lines do. Carefully follow the instructions above, and only draw the required object. Marginal Benefit, Marginal Cost ($) 20- 18- 16- 14- có + 2- 0- -O 0 1 MC 2 3 4 5 6 7 8 9 Quantity of a Public Good MBA MBB 10 11 12 Q
C. How would you calculate: (1) the total amount of subsidy incurred by the government to socially efficient allocate?
Refer to the figure below. At the private market equilibrium quantity, the social marginal cost of the last unit produced is B * I I F G H Quantity (units/day) Price ($/unit) A U equal to E greater than less than less important than Social MC Private MC Demand the marginal benefit of the last unit produced.

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