There is one consumer who is a price takerand a monopoly company that is a pricesetter. When a consumer buys as much as qat the market price p,benefit B(q)=90q-1/2q^ and spend as much aspq.A monopoly company earn Tr=p-Cq)when it produces as much as q.C(q)=20q+1/2q^When the exchange volume is q,CE(q)=10q+1/2q^Find the market equilibrium quantity.Find the efficient quantity.When pigouvian tax is charged, find pigouviantax per unit .

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There is one consumer who is a price tak and a monopoly company that is a price setter. When a consumer buys as much a at the market price p, benefit B(q)=90q-1/2q^ and spend as mu- na

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Concept explainers

Productive and Allocative Efficiency Analysis

Productive efficiency, also referred to as production efficiency is a term in economics describing the level at which a company is operating at its maximum capacity. Beyond this point, the entity will be unable to manufacture any additional goods without cutting down another product’s production level. This occurrence is an outcome of production happening alongside a Production Possibility Frontier (PPF).

Question

There is one consumer who is a price taker
and a monopoly company that is a price
setter. When a consumer buys as much as q
at the market price p,
benefit B(q)=90q-1/2q^ and spend as much as
pq.
A monopoly company earn Tr=p-Cq)
when it produces as much as q.
C(q)=20q+1/2q^
When the exchange volume is q,
CE(q)=10q+1/2q^
Find the market equilibrium quantity.
Find the efficient quantity.
When pigouvian tax is charged, find pigouvian
tax per unit .

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