The cost (supply) of each "unit" of NPR (National Public Radio) is P-9. Derek's valuation for each unit of NPR (demand) is given by Pp-20-2Q, and Kim's valuation is given by Px=10-Q. The social valuation of NPR is Ps= Q. The socially optimal amount of NPR is units. : of NPR Without intervention, the private market would lead to an Suppose the government decides to subsidize NPR in order to achieve the socially optimal amount of NPR P. The total demand function is Qr= (include 2 decimals) per unit of NPR. no annropriate subsidy is $

The cost (supply) of each "unit" of NPR (National Public Radio) is P-9. Derek's valuation for each unit of NPR (demand) is given by Pp-20-2Q, and Kim's valuation is given by Px=10-Q. The social valuation of NPR is Ps= Q. The socially optimal amount of NPR is units. : of NPR Without intervention, the private market would lead to an Suppose the government decides to subsidize NPR in order to achieve the socially optimal amount of NPR P. The total demand function is Qr= (include 2 decimals) per unit of NPR. no annropriate subsidy is $

Economics (MindTap Course List)

13th Edition

ISBN:9781337617383

Author:Roger A. Arnold

Publisher:Roger A. Arnold

Chapter30: Market Failure: Externalities, Public Goods, And Asymmetric Information

Section: Chapter Questions

Problem 2WNG

See similar textbooks

Similar questions

The cost (supply) of each "unit" of NPR (National Public Radio) is P=9. Derek's valuation for each unit of NPR (demand) is given by Pp=20-2Q, and Kim's valuation is given by Pg=10-Q. The social valuation of NPR is Ps= Q. The socially optimal amount of NPR is units. Without intervention, the private market would lead to an of NPR. Suppose the government decides to subsidize NPR in order to achieve the socially optimal amount of NPR. The total demand function is Qr= P. The appropriate subsidy is $ (include 2 decimals) per unit of NPR.
National Public Radio (NPR) is a public good. The cost (supply) of each "unit" of NPR is P=2. Derek's valuation for each unit of NPR (demand) is given by PD=10-Q, and Kim's valuation is given by PK-4-0.25Q. The total social valuation (demand) of NPR is Ps= Q. The socially optimal amount of NPR is units. Without intervention, the private market would lead to an ♦ of NPR.
Scenario 10-1The demand curve for gasoline slopes downward and the supply curve for gasoline slopes upward. The production of the 200th gallon of gasoline entails the following: a private cost of $3.03; a social cost of $3.23; a value to consumers of $3.39. Refer to Scenario 10-1. Let QMARKET represent the equilibrium quantity of gasoline, and let QOPTIMUM represent the socially optimal quantity of gasoline. Which of the following inequalities is correct? Group of answer choices QOPTIMUM < QMARKET < 200 QMARKET < 200 < QOPTIMUM 200 < QOPTIMUM < QMARKET QOPTIMUM < 200 < QMARKET
National Public Radio (NPR) is a public good. The cost (supply) of each "unit" of NPR is P=2. Derek's valuation for each unit of NPR (demand) is given by PD=10–Q, and Kim's valuation is given by PK=4–0.25Q.The total social valuation (demand) of NPR is PS=Answer-AnswerQ.The socially optimal amount of NPR is Answer units. Without intervention, the private market would lead to an Answer of NPR.
A study finds that the noise from lawn mowers is harmful; hence, the government imposes a $20 tax on the sale of every lawn mower. This amount accurately accounts for the external cost of the noise pollution. Before the corrective tax, basic push mowers regularly sold for $190. After the tax is in place, the market price for basic push mowers rises to $195. The socially optimal price of basic push mowers is _____ $ .
There are two consumers of mosquito abatement (a public good), Dash and Lily. Dash's benefit from mosquito abatement is given by MBD = 100 - Q, where Q is the quantity of mosquito abatement. Lily's benefit is given by MBL = 60 - Q. a. Calculate the total marginal benefit, MBr. b. Suppose that mosquito abatement can be provided at a marginal cost of MC = 2Q. Find the socially optimal level of abatement. c. If mosquito abatement is privately supplied, what quantity will be supplied by Dash, and what quantity will be supplied by Lily? Briefly explain.
Harold smokes cigarettes but his office mate Kumar hates smoking. Harold and Kumar havethe following utility functions:UH = 100 + 10z – 0.1z2UK = 100 – 10z,where z is the number of cigarettes smoked by Harold (and UH includes the cost of cigarettes).Determine:a. The number of cigarettes smoked by Harold when the external effect on Kumar is ignored;b. The socially optimal number of cigarettes smoked. To find the socially optimal numberof cigarettes smoked, we create a social welfare function (SWF). The SWF is definedas the sum of Harold’s utility and Kumar’s utility. Using this approach, find the sociallyoptimal level of cigarettes that should be smoked by Harold;c. The Pigouvian tax needed to reach this social optimum;d. The outcome with Coasian bargaining when the property right is assigned Harold;e. The outcome with Coasian bargaining when the property right is assigned to Kumar.
The private market demand curve for flu shots is P = 100 - 4Q, and the supply curve for flu shots is P = 22 + Q where Q is a million shots per year and P is the dollars per shot. Assume that the flu shots generate an additional benefit in that it reduces the likelihood of others getting sick. This benefit is reflected in a social demand curve P 112-4Q. The private market equilibrium quantity of shots produced is optimal amount of shots is, but the socially Around 9 to 10 million shots.... Around 10 to 11 million shots Around 7 to 8 million shots.. Around 18 to 20 million shots Around 18 million shots ... Around 15 to 16 million shots Around 15 to 16 million shots ... Around 18 million shots
Public Goods. Suppose a neighborhood in Segovia’s central business area is deciding how many fountains they want to see in the main avenue. There is a first group of 20 neighbors and each has a demand Q = 20 − P for fountains. There is a second group of 5 people, and each has a demand Q = 20 − 2P for fountains. The cost of building each fountain is 225. How many fountains are socially optimal? Fountains are public goods. Hint: To obtain the SMB, please first transform the demand functions into “public goods’ valuations” (“isolate P”) and then multiply them by the amount of neighbors per group. Then you can proceed with the vertical summation.
The LoJack car recovery system allows the police to track stolen cars. As a result, they not only recover 90 percent of LoJack-equipped cars that are stolen but also arrest many auto thieves and shut down many “chop shops” that take apart stolen vehicles to get at their used parts. Thus, LoJack provides both private benefits and positive externalities. Should the government consider subsidizing LoJack purchases?
Need details solutions
The production of fabric generates toxic effluents related to the dyes used. This is typically disposed of with wastewater, which generates pollution. If the government does not intervene, the market for fabric has an equilibrium price of $250 per roll and an equilibrium quantity of 10,000 rolls. a.How would the socially optimal quantity of fabric compare to the free market equilibrium quantity of 10,000 rolls? Why? b. Using a supply and demand graph show the effect on social welfare of allowing the market for fabric to operate without government intervention. Label all the curves and relevant points on your graph. c. Would a government subsidy or tax help the market achieve the social optimum? Explain. Show the necessary subsidy/tax on your graph. d. Explain how this intervention helps achieve the social optimum and what information would be necessary to implement it.