Suppose the supply curve of motorized scooter rentals in Golden Gate Park is given by: P = 5 + 0.1Q, where P is the daily rent per unit in dollars and Q is the volume of units rented in hundreds per day. The demand curve for motorized scooters is: P=20 -0.2Q. If each motorized scooter imposes $2.10 per day in noise costs on others, by how much will the equilibrium number of motorized scooters rented exceed the socially optimal number? units (in hundreds).
Suppose the supply curve of motorized scooter rentals in Golden Gate Park is given by: P = 5 + 0.1Q, where P is the daily rent per unit in dollars and Q is the volume of units rented in hundreds per day. The demand curve for motorized scooters is: P=20 -0.2Q. If each motorized scooter imposes $2.10 per day in noise costs on others, by how much will the equilibrium number of motorized scooters rented exceed the socially optimal number? units (in hundreds).
Micro Economics For Today
10th Edition
ISBN:9781337613064
Author:Tucker, Irvin B.
Publisher:Tucker, Irvin B.
Chapter4: Markets In Action
Section: Chapter Questions
Problem 8SQP
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Transcribed Image Text:Suppose the supply curve of motorized scooter rentals in Golden Gate Park is given by:
P = 5 + 0.1Q,
where P is the daily rent per unit in dollars and Q is the volume of units rented in hundreds per day. The demand curve for motorized
scooters is:
P=20 -0.2Q.
If each motorized scooter imposes $2.10 per day in noise costs on others, by how much will the equilibrium number of motorized
scooters rented exceed the socially optimal number?
units (in hundreds).
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