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Figure 1 24 22 18 16 Price 120 160 Social cost (private cost and external cost) Supply (private cost) Demand (private value) Refer to Figure 1. An increase in output from 120 units to 160 units would OC. $240. O d. $40. a. increase total economic well-being. b. decrease the external cost per unit of output. O c. move the market from a socially efficient outcome to a socially inefficient outcome. O d. increase the price of the good from $18 to $24. Quantity Refer to Figure 1. The NET BENEFIT (defined as the benefit= bystanders - DWL) from reducing the quantity to 120 units from 160 units is equal O a. 50. There can be no benefit from reducing quantity, only loss in surplus. O b. $120.

Figure 1 24 22 18 16 Price 120 160 Social cost (private cost and external cost) Supply (private cost) Demand (private value) Refer to Figure 1. An increase in output from 120 units to 160 units would OC. $240. O d. $40. a. increase total economic well-being. b. decrease the external cost per unit of output. O c. move the market from a socially efficient outcome to a socially inefficient outcome. O d. increase the price of the good from $18 to $24. Quantity Refer to Figure 1. The NET BENEFIT (defined as the benefit= bystanders - DWL) from reducing the quantity to 120 units from 160 units is equal O a. 50. There can be no benefit from reducing quantity, only loss in surplus. O b. $120.

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Figure 1 24 22 18 16 6 0 Price 120 160 Social cost (private cost and external cost) O C. O d. $40. $240. Supply (private cost) Refer to Figure 1. An increase in output from 120 units to 160 units would -Demand (private value) a. increase total economic well-being. O b. decrease the external cost per unit of output. O c move the market from a socially efficient outcome to a socially inefficient outcome. O d. increase the price of the good from $18 to $24. Refer to Figure 1. The NET BENEFIT (defined as the benefit= bystanders - DWL) from reducing the quantity to 120 units from 160 units is equal O a. $0. There can be no benefit from reducing quantity, only loss in surplus. O b. $120. Quantity
Transcribed Image Text:Figure 1 24 22 18 16 6 0 Price 120 160 Social cost (private cost and external cost) O C. O d. $40. $240. Supply (private cost) Refer to Figure 1. An increase in output from 120 units to 160 units would -Demand (private value) a. increase total economic well-being. O b. decrease the external cost per unit of output. O c move the market from a socially efficient outcome to a socially inefficient outcome. O d. increase the price of the good from $18 to $24. Refer to Figure 1. The NET BENEFIT (defined as the benefit= bystanders - DWL) from reducing the quantity to 120 units from 160 units is equal O a. $0. There can be no benefit from reducing quantity, only loss in surplus. O b. $120. Quantity
Refer to Figure 1. The optimal Pigouvian/corrective tax equals a. $2. b. $18. O c. $6. O d. 50. Refer to Figure 1. The benefit to bystanders (i.e., 3rd party) from reducing the quantity to 120 units from 160 is equal O a. $0. There can be no benefit from reducing quantity, only loss in surplus. O b. $120. O c O d. $240. $40.
Transcribed Image Text:Refer to Figure 1. The optimal Pigouvian/corrective tax equals a. $2. b. $18. O c. $6. O d. 50. Refer to Figure 1. The benefit to bystanders (i.e., 3rd party) from reducing the quantity to 120 units from 160 is equal O a. $0. There can be no benefit from reducing quantity, only loss in surplus. O b. $120. O c O d. $240. $40.
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