The President of ALS Society of America asks you to determine whether the level of ALS research in the U.S. is close to where it should be. You decide to estimate the demand and supply curves for ALS research, which you are thinking of as a pure public good. You find that there are two types of people in the U.S., each with a very different demand for autism research: Mother Teresas: P = $50-2Q Scrooges: P = $10-Q You also estimate that the marginal cost of producing each ALS study is $20. b. Sketch the Market Demand Curve? • Label the x and y intercepts. Label the P and Q at the kink. • The kink will be on the demand curve for the higher-demand group at the quantity where the lower demand group's demand falls to zero.
The President of ALS Society of America asks you to determine whether the level of ALS research in the U.S. is close to where it should be. You decide to estimate the demand and supply curves for ALS research, which you are thinking of as a pure public good. You find that there are two types of people in the U.S., each with a very different demand for autism research: Mother Teresas: P = $50-2Q Scrooges: P = $10-Q You also estimate that the marginal cost of producing each ALS study is $20. b. Sketch the Market Demand Curve? • Label the x and y intercepts. Label the P and Q at the kink. • The kink will be on the demand curve for the higher-demand group at the quantity where the lower demand group's demand falls to zero.
Chapter4: Economic Evaluation In Health Care
Section: Chapter Questions
Problem 2QAP
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![DNFP7 (b)
The President of ALS Society of America asks you to determine whether the level
of ALS research in the U.S. is close to where it should be. You decide to estimate
the demand and supply curves for ALS research, which you are thinking of as a
pure public good. You find that there are two types of people in the U.S., each with
a very different demand for autism research:
Mother Teresas: P = $50-2Q
Scrooges:
P = $10-Q
You also estimate that the marginal cost of producing each ALS study is $20.
b. Sketch the Market Demand Curve?
• Label the x and y intercepts.
Label the P and Q at the kink.
•
The kink will be on the demand curve for the higher-demand group at the
quantity where the lower demand group's demand falls to zero.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F6274a625-9a74-4008-b392-f1961eea52c4%2F8881bf8b-bf6d-4d21-a3ac-7db1ab191541%2Fnvvyofy_processed.jpeg&w=3840&q=75)
Transcribed Image Text:DNFP7 (b)
The President of ALS Society of America asks you to determine whether the level
of ALS research in the U.S. is close to where it should be. You decide to estimate
the demand and supply curves for ALS research, which you are thinking of as a
pure public good. You find that there are two types of people in the U.S., each with
a very different demand for autism research:
Mother Teresas: P = $50-2Q
Scrooges:
P = $10-Q
You also estimate that the marginal cost of producing each ALS study is $20.
b. Sketch the Market Demand Curve?
• Label the x and y intercepts.
Label the P and Q at the kink.
•
The kink will be on the demand curve for the higher-demand group at the
quantity where the lower demand group's demand falls to zero.
![DNFP7 (b)
The President of ALS Society of America asks you to determine whether the level
of ALS research in the U.S. is close to where it should be. You decide to estimate
the demand and supply curves for ALS research, which you are thinking of as a
pure public good. You find that there are two types of people in the U.S., each with
a very different demand for autism research:
Mother Teresas: P = $50-2Q
Scrooges:
P = $10-Q
You also estimate that the marginal cost of producing each ALS study is $20.
b. Sketch the Market Demand Curve?
• Label the x and y intercepts.
Label the P and Q at the kink.
•
The kink will be on the demand curve for the higher-demand group at the
quantity where the lower demand group's demand falls to zero.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F6274a625-9a74-4008-b392-f1961eea52c4%2F8881bf8b-bf6d-4d21-a3ac-7db1ab191541%2Fx5sa5ar_processed.jpeg&w=3840&q=75)
Transcribed Image Text:DNFP7 (b)
The President of ALS Society of America asks you to determine whether the level
of ALS research in the U.S. is close to where it should be. You decide to estimate
the demand and supply curves for ALS research, which you are thinking of as a
pure public good. You find that there are two types of people in the U.S., each with
a very different demand for autism research:
Mother Teresas: P = $50-2Q
Scrooges:
P = $10-Q
You also estimate that the marginal cost of producing each ALS study is $20.
b. Sketch the Market Demand Curve?
• Label the x and y intercepts.
Label the P and Q at the kink.
•
The kink will be on the demand curve for the higher-demand group at the
quantity where the lower demand group's demand falls to zero.
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