Homework (Ch 10)Use the black point (plus symbol) to indicate the market equilibrium quantity. Next, use the purple point (diamond symbol) to indicate the sociallyoptimal quantity.Social CostMarket EquilibriumSocially Optimal LevelPRICE OF AIR HORNS69°FCloudySupply(Private Cost)Demand(Private Value)QUANTITY OF AIR HORNSCI 3°F2. Efficiency in the presence of externalitiesAir horns impose many external costs on society: the risk of being deafened, the annoyance of being awakened in the middle of the night, and so on.Therefore, the market equilibrium quantity of air horns is not equal to the socially optimal quantity. The following graph shows the demand for airhorns (their private value), the supply of air horns (the private cost of producing them), and the social cost of air horns, including both the private costand external costs.Use the black point (plus symbol) to indicate the market equilibrium quantity. Next, use the purple point (diamond symbol) to indicate the sociallyoptimal quantity.Social CostMarket EquilibriumSocially Optimal LeveloudyPRICE OF AIR HORNSSupply(Private Cost)D

The optimal allocation of resources in society, taking into consideration all external and internal…

Use the black point (plus symbol) to indicate the market equilibrium quantity. Next, use the purple point (diamond symbol) to indicate the socially optimal quantity. (? Social Cost PRICE OF AIR HORNS F oudy Supply (Private Cost) Demand (Private Value) QUANTITY OF AIR HORNS +|+| Market Equilibrium Socially Optimal Level C C

Use the black point (plus symbol) to indicate the market equilibrium quantity. Next, use the purple point (diamond symbol) to indicate the socially optimal quantity. (? Social Cost PRICE OF AIR HORNS F oudy Supply (Private Cost) Demand (Private Value) QUANTITY OF AIR HORNS +|+| Market Equilibrium Socially Optimal Level C C

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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A local school administrator observes an increase in the number of flu cases in the public schools over the last two years. She is concerned that some families cannot afford flu vaccine and are therefore not having children vaccinated. She is also concerned that the failure to vaccinate some children is putting other children at risk, so she proposes that the state subsidize vaccines to increase coverage rates. a. Determine whether the failure to vaccinate some children is an external benefit or an external cost. If an external cost is present, move point A and point B to show the marginal social cost curve. If an external benefit is present, move point A and point B to show the marginal social benefit curve. Place point C at the equilibrium outcome. Place point D at the socially optimal outcome. Flu vaccines A B D Supply (marginal private cost) Price
Suppose that the logging industry in Canada is unregulated, and anyone can cut-down a tree on public land and sell it. We would expect to see trees cut-down since the marginal social cost of cutting down trees the price of trees. Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer. too many; equals b too many; is below c the optimal amount of; equals too many; is above
1-19 At the equilibrium: A. Price offered by buyers = Price demanded by sellers B. MCMB C. Price MB D. Price MC E. Social welfare is maximized F. All of the above = ‒‒‒‒‒‒‒‒‒
a. The socially optimal level of production is ____units. b. But, the market will end up producing ____units a. The socially optimal level of production is how many units? b. The market will end up producing how many units?
Price P X D S Q Quantity per period (Figure: Model of a Competitive Market) If there are external costs, a tax imposed on sellers will: Choose one answer. a. decrease the equilibrium quantity. b. have no effect on the equilibrium price. c. decrease the equilibrium price. d. increase the equilibrium quantity.
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Consider the supply of soybeans in South America and the demand for soybeans in China. Draw a graph in which you show the current market equilibrium price of soybeans and quantity of soybeans traded. Include the curve that shows the true social costs of soybean production. Show the socially optimal amount of soybeans traded. Show the price that should really be charged for soybeans to ensure that production moves to the socially optimal level. Ensure that you label your graph correctly (all curves, axes, prices and quantities labeled). Show the deadweight loss of soybean production. What intervention could be used to change the market price for soybeans to the level that would move the quantity of soybeans traded to the optimal level? Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.
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…
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B. Let’s consider the market for flour in a different town. Assume that it is efficient (i.e. that there are not external costs to producing flour, and no external benefits from consuming it). Price ($/lb) Quantity Supplied (thousands of lbs per day) Quantity Demanded (thousands of lbs per day) 1.5 8 14 2 9 13 2.5 10 12 3 11 11 3.5 12 10 4 13 9 What is the price and quantity of flour sold without government intervention. Graph this equilibrium. XXXX 2. Suppose that, alarmed by the inability of many poorer consumers to buy flour, the government institutes a $2/lb price ceiling. How much flour will suppliers wish to sell, and how much will buyers demand? How much flour will actually be sold? Show this outcome on the same graph you drew for question 1. XXXX 3. Describe, in one sentence each, three problems that this policy might create? Please do not simply copy down phrases from the textbook, but instead describe ways that…
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per unit $P $24 $22 $20 $17 $13 0 Area "abd" Area "efad" Area "efbc" e b O Area "abcd" O Area "abc" C d a 50 70 Use the graph above (note: the graph may be different than the previous question). If the market is producing at 50 units, what area corresponds to the deadweight loss in the market? social MC Private MC private MB # of units O There is no deadweight loss when producing at that quantity.