The following table shows how the marginal benefit enjoyed by John, Mary, Loren, and all other consumers of outdoor rock concerts varies with the number made available by a city government per summer. a) Derive the demand curve for rock concerts assuming that it is a pure public good. b) If the marginal cost of producing rock concerts is $1,000 no matter how many are produced, then what is the efficient number of concerts to have each summer?

ENGR.ECONOMIC ANALYSIS
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Chapter1: Making Economics Decisions
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The following table shows how the marginal benefit enjoyed by John, Mary, Loren, and all other consumers of outdoor rock concerts varies with the number made available by a city government per summer.

a) Derive the demand curve for rock concerts assuming that it is a pure public good.

b) If the marginal cost of producing rock concerts is $1,000 no matter how many are produced, then what is the efficient number of concerts to have each summer?

 

 

Marginal Benefit of Number of Concert Per Customer in Dollars ($)
Number of Concerts
CONSUMER
3
4
150
125
125
John
Mary
75
50
100
100
75
Loren
100
75
50
25
All others
600
400
200
100
Transcribed Image Text:Marginal Benefit of Number of Concert Per Customer in Dollars ($) Number of Concerts CONSUMER 3 4 150 125 125 John Mary 75 50 100 100 75 Loren 100 75 50 25 All others 600 400 200 100
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