The graph illustrates the market for pesticide with no government intervention. When the factories produce pesticide, they also create waste, which they dump into a lake on the outskirts of town. The marginal external cost of the dumped waste is equal to the marginal private cost of producing pesticide (that is, the marginal social cost of producing the pesticide is double the marginal private cost.) What quantity of pesticide is produced if no one owns the lake? If no one owns the lake, the quantity of pesticide produced is tonnes a week. The efficient quantity of pesticide is tonnes a week.

The graph illustrates the market for pesticide with no government intervention. When the factories produce pesticide, they also create waste, which they dump into a lake on the outskirts of town. The marginal external cost of the dumped waste is equal to the marginal private cost of producing pesticide (that is, the marginal social cost of producing the pesticide is double the marginal private cost.) What quantity of pesticide is produced if no one owns the lake? If no one owns the lake, the quantity of pesticide produced is tonnes a week. The efficient quantity of pesticide is tonnes a week.

ECON MICRO

5th Edition

ISBN:9781337000536

Author:William A. McEachern

Publisher:William A. McEachern

Chapter17: Externalities And The Environment

Section: Chapter Questions

Problem 2.5P

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K The graph illustrates the unregulated market for pesticide. When the factories produce pesticide, they also create waste which they dump into a lake on the outskirts of a small town. The marginal external cost of the dumped waste is equal to the marginal private cost of producing pesticide (that is, the marginal social cost of producing the pesticide is double the marginal private cost). What is the quantity of pesticide produced if no one owns the lake and what is the efficient quantity of pesticide? What is the deadweight loss? *** If no one owns the lake, the quantity of pesticide produced is 30 tons a week. The efficient quantity of pesticide is 20 tons a week. If no one owns the lake, the deadweight loss is $ >>> Answer to 2 decimal places. a week. 1260 1080- 900- 720- 540- 360- 180- 0- 0 Price (dollars per ton) | 4 S D 30 60 90 120 150 180 210 240 270 300 Quantity (tons of pesticide per week) Q P
The graph illustrates the unregulated market for pesticide. When the factories produce pesticide, they also create waste which they dump into a lake on the outskirts of a small town. The marginal external cost of the dumped waste is equal to the marginal private cost of producing pesticide (that is, the marginal social cost of producing the pesticide is double the marginal private cost). If the pesticide factories own the lake, how much pesticide is produced? If the pesticide factories own the lake, the quantity of pesticide produced is tons a week. 1080- 960- 840- 720- 600- 480- 360- 240- 120- 0+ 0 Price and cost (dollars per ton) 30 S 120 D 60 90 Quantity (tons per week) >>> Draw only the objects specified in the question. Q Q 150
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The following graph shows the marginal social cost (MSC), the marginal private cost (MPC), and the marginal social benefit (MSB) of a good. MSC S = MPC $3.00 $2.50 $2.00 $1.50 $1.00 D = MSB 40 60 80 Quantity Which of the following indicate the marginal external cost and the socially optimal quantity? A $3.00 and 40 units $2.50 and 60 units $2.00 and 40 units D $1.00 and 20 units $1.00 and 80 units 20
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