The marginal cost of educating a college student is $3,000 a year.The table shows the marginal benefit schedule of a college education. The marginal externalbenefit of a college education is a constant $1,000 per student per year. There are no publiccolleges.With no government involvement in college education, how many students enroll, what is thetuition, and what is the deadweight loss created?With no government involvement in college education,is $ per student per year.million students enroll and tuitionStudents(millions per year)12 3 4 5 6 7 8Marginal benefit(dollars per student per year)5,0003,0002,0001,5001,2001,000800500 The marginal cost of educating a college student is $2,000 a year.The table shows the marginal benefit schedule of a college education. The marginal externalbenefit of a college education is a constant $1,000 per student per year. There are no publiccolleges.If the government subsidizes colleges and sets the subsidy so that the efficient number ofstudents enroll, what is the subsidy per student, how many students enroll, and what is thecost to taxpayers?The subsidy is $per student andmillion students enroll.Students(millions per year)12 3 4 5 6 7 88Marginal benefit(dollars per student per year)5,0003,0002,0001,5001,2001,000800500

Marginal cost is the cost incurred by producers while producing one additional unit of the product,…

Answered: The marginal cost of educating a…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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The figure above shows the marginal social cost and marginal social benefit curves for a chemical producing firm operating upstream from a hatchery. If the government imposes a tax of $20 per ton of emissions, the chemicals firm will emit MSC, MSB ($/ton) 100 MSC 90 800 70 60 50 40 30 20 MSB 10 2. 3. 6. 10 Quantity of Emissions (tons per day)
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2 The market for education confers positive externalities on society. Which of the following is an example of a positive externality that it provides? Higher quality of public institutions like government and law Subsidies for providing education Higher salary for the person earning a degree More colleges and universities X OOOO W F2 3 16 80 F3 E 888 FA R DE F % V T MacBook Air 6 Y B & 7 H tv NA 2 N 8 K M 0 W Aa zoom 0
Most countries today have subsidised the provision of education. Consider an imaginary country, Gondolin. Gondolin pays a subsidy of $10 000 per year to each student enrolled in tertiary education. ADDITIONAL INFO - DONT NEED THIS ANSWERED - Depict, with the help of a figure, the initial market for tertiary education in Gondolin, assume that: 1) education was left to the competitive free market; 2) the marginal private benefit is equal to the marginal social benefit; 3) the marginal private cost is equal to the marginal social cost. Now describe, using the help of the figure, the effect of the government subsidy on the price and quantity traded of tertiary education, where the X axis of the figure should be the quantity of students enrolled in tertiary education. You do not need to use actual numbers – focus on the direction of change in price and quantity traded caused by the subsidy. QUESTION Identify the area of the figure you drew in (a) that depicts the total size of the…
What is the definition of public goods? Why does the private market not produce the efficient quantity of a public good?
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Only typed answer You are an industry analyst that specializes in an industry where the market inverse demand is P = 100 - 3Q. The external marginal cost of producing the product is MCExternal = 6Q, and the internal cost is MCInternal = 14Q. Instruction: Round your answers to the nearest two decimal places. a. What is the socially efficient level of output? units b. Given these costs and market demand, how much output would a competitive industry produce? units c. Given these costs and market demand, how much output would a monopolist produce? units d. Which of the following are actions the government could take to induce firms in this industry to produce the socially efficient level of output. Instructions: You may select more than one answer. Click the box with a check mark for the correct answers and click twice to empty the box for the wrong answers. You must click to select or deselect each option in order to receive full credit. Pollution taxes…
Policymakers realize that, although education creates a positive benefit for those who obtain it, it also creates external benefits for the community where the educated individual resides. The graph depicts the marginal social cost (MSC) and the marginal social benefit (MSB) associated with education. On the graph, move the point, P, to the point representing the optimal level of education. Dollars (thousands) 100 90 80 70 60 50 40 30 20 10 0 0 2 4 MSC MSB 6 8 10 12 14 16 18 20 22 Years of schooling optimal schooling: 14 What is the socially optimal number of years of schooling for each citizen? years
QUESTION 24 55.00 50.00 45.00 40.00 35.00 30.00 25.00 20.00 15.00 10.00 5.00 What is the deadweight loss from the externality a. $75,000 b. $100,000 Supply c. $80,000 Ⓒd. $50,000 MSC M 5000 10000 15000 20000 25000 30000 35000 40000 Demand
. Some dissenting scientists at Environment Canada disagree with the estimate of $1.50 for theenvironmental externality. They believe that the incidence of the externality is not constant acrossdifferent levels of production; instead the size of the externality is proportional to the level of output.That is, the larger is the output, the larger is the externality. Their research suggests that the truesocial cost of cereal production diverges from private costs at every level of production by an amountequal to ten percent of production (note: ten percent, not ten percentage points).The government would like to know the economic effects of implementing a tax to internalise theexternality in this case. Draw the diagram for this market and policy. Solve for all relevant Ps and Qs.Calculate producer surplus

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