The market for paper in a particular region in the United States is characterized by the following demand and supply curves:Qp = 145,000 – 2,000PandQs = 50,000 + 2,000Pwhere Q, is the quantity demanded in 100-pound lots, Qg is the quantity supplied in 100-pound lots, and P is the price per 100-pound lot. Currently there is no attempt to regulatethe dumping of effluent into streams and rivers by the paper mills. As a result, dumping is widespread. The marginal external cost (MEC) associated with the production of paperis given by the curveMEC = 0.0006QSa. Calculate the output and price of paper if it is produced under competitive conditions and no attempt is made to monitor or regulate the dumping of effluent. (Enter yourresponses rounded to two decimal places.)Without regulation, the price is $ 23.75 per 100-pound lot, and the quantity is 97500 100-pound lots.b. Determine the socially efficient price and output of paper. (Enter your responses rounded to two decimal places.)The socially efficient price is $ per 100-pound lot, and the socially efficient quantity is100-pound lots.

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Answered: The market for paper in a particular…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Please no written by hand solution In this question, the letter “A” denotes the last 4 digits of your student number (for example, if your student number is: 183405022, then A = 5022). The perfectly competitive market for coal in a particular region of Turkey is characterized by the following demand and supply curves: QD = 15000 − 300P and QS = −A + 200P. Moreover, the marginal external cost associated with the production of coal is given by the curve: MEC = Q/800. a) Compute the market equilibrium price and output for coal.b) Compute the socially efficient price and output for coal. (Hint: What is MPB, MPC, MSB and MSC?) c) Explain why the answers you calculated in parts (a) and (b) differ.d) Suppose that the government wants to implement a per-unit tax on coal production so that the socially efficient level of production is reached in the market. Write the MPC of the firm with including tax. What is the level of tax that leads to socially efficient output?
e. Determine the deadweight loss to society (if any) when the regulated price is $10 per unit.
Assume integer quantities. Assume the following supply and demand schedules for a perfectly competitive market without externalities. 1 3 4 6 MWTP $32.50 $27.50 $6 $25.50 $12 $20.50 $12.50 $7.50 $4.50 MC $2 $16 $21 $30 $32 What is total surplus in equilibrium? Round to two decimal places and do not include the currency symbol. If your answer is $1.125, enter 1.13.
Please give detailed procedure
Suppose Firm A is the anly producer in some market. You are given information about the market demand and marginal cost for Firm As product Firm A's market demand is given by: Q= 60 - P Firm A's marginal cost is given by: MC = 6+Q A) Calculate the profit-maximizing output for Firm A. B) Calculate the profit-maximizing price for Firm A. Calculate what would have been the socially efficient output level produced in this market.
For centuries, Alaskans relied on salmon and other freshwater fish for protein, oil, and other nutrients. But when jetliners began flying tourists who love fishing from Seattle to Anchorage in the 1950s, the stock of Alaskan salmon began falling. The Alaska Department of Fish and Game had concerns about the high fraction of young salmon caught before they could reproduce. Following the advice of environmental scientists and economists, the Alaska Department of Fish and Game introduced restrictions on the minimum size (28 inches) and the number of salmon caught (5 per day). Among their concerns was the high fraction of young salmon caught before they could reproduce. a. Alaskan salmon are a b. In the graph, place point A on the market equilibrium and place point B on the socially optimal outcome. Price of salmon Market for Alaskan salmon B A Marginal social cost Marginal private cost Marginal benefit
The government is considering setting up a public health program to cull birds to prevent the spread of bird flu in two regions. The marginal benefit for this program in region A is QA = 90 − 3P and in region B is QB = 250 − 5P. What is the marginal social benefit curve for this program across both regions?
Consider Product NE, which has a negative externality associated with its’ production and use ( i.e., the “Incidental Cost” of each unit of Product NE is greater than zero). You are told that : * The “Efficient” Output of Product NE = 100 units * The Free-Market Equilibrium Output of Product NE = 125 units * The Total Surplus ( to society) on Unit Number 50 ( i.e., on that one unit ALONE) is equal to $ 45 * The Cumulative Surplus on the first 100 units produced is equal to $ 6,000 ( i.e., the sum of the surplus( to society) on ALL 100 units adds up to $ 6,000) Is the Consumer’s Surplus + Producer’s Surplus on Unit Number 50 ( i.e., the sum of CS + PS) greater than $ 45, less than $ 45, or exactly equal to $ 45 ( just circle your answer) ? Greater than $ 45 Less Than $ 45 Exactly $ 45 *Draw a graph to…
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Suppose an environmental impact study showsthat the coral reef near Port Douglas, Australia,can sustain 20 scuba diving tours per week. Discuss the pros and cons of setting a quota of 20 divetours per week
(Figure: Output Levels II) The socially optimal output level could be achieved by a government quota of: Price ($) 100 80 60 40 20 0 SMC S = MC 100 200 300 400 500 Quantity of electricity 250 units of electricity. approximately 212 units of electricity. 175 units of electricity. 100 units of electricity.
[The drainage of waste products from the chemical factory, Ultra Chemicals, situated along the banks of the Misty River has led to the formation of a dead zone in the river that cannot support aquatic life.] [Without any government intervention, will Ultra Chemicals produce a socially optimal quantity? Why or why not? Explain your answer in 200 words or less with the help of a suitable diagram. [Does Ultra Chemicals impose a deadweight loss on society? Explain in 100 words or less. Use your diagram to show the deadweight loss to society. [How can a government intervene to improve upon the outcome from society’s point of view? Explain in 100 words or less. Diagram not needed.

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