Why do markets fail to provide public goods? OA. Public goods are rival, so the government must prevent unfair competition among firms providing them. OB. Public goods provide positive externalities, so socially optimal production is higher than private production. C. Public goods prevent negative externalities, so the government must bear the cost. D. Public goods are nonexclusive, so firms can't charge money for

Why do markets fail to provide public goods? OA. Public goods are rival, so the government must prevent unfair competition among firms providing them. OB. Public goods provide positive externalities, so socially optimal production is higher than private production. C. Public goods prevent negative externalities, so the government must bear the cost. D. Public goods are nonexclusive, so firms can't charge money for

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 public good which creates no externalities is _____________________ by a free competitive market. A. Underprovided B. Overprovided C. Optimally provided
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1. True or False d. In the presence of an unpriced negative externality such as roadway congestion, marginal private benefit will be less than marginal social cost. e. The optimal level of roadway congestion is zero. f. The optimal congestion toll on a road would be the difference between marginal benefit and marginal private cost at the optimal level of road usage.
By imposing a tax on the production of electricity equal to the cost of acid rain, the government will cause electric utilities to internalize the externality. As a consequence, the cost of the acid rain will become a OA. social cost borne by the public, and the demand curve for electricity will shift down. OB. social cost borne by the public, and the demand curve for electricity will shift up. C. private cost borne by the utilities, and the supply curve for electricity will shift down. D. private cost borne by the utilities, and the supply curve for electricity will shift up. Question Viewer
I need help with qusetion A, B and C
Mark the correct answer(s) d. Heterogeneity leads to more infomation that a consumer has to collect before being able to make a rational decision. e. If one market side has more information than the other side, economist name this situation as asymmetric information. f. Negative external effects lead to a higher than optimal market quantity. g. Competitive markets are assumed to have total transparency and information. h. Most markets do not produce or trade homogeneous, but heterogeneous goods. i. Akerlof's lemon market model and the solutions show that goverment does not always have to intervene to keep the market working in case of asymmetric information. j. Positive external effects do not need a corrective intervation. Please answer all with short explanation
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I need help with A, B, C and D.
2. Refer to Graph 10-1. Assume the externality is not internalised. What is the loss to society from the last unit of the good produced by the market? A. P3-P2 B. P2-P1 C. P3-P1 D. ZeroGraph 10-1 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.
Which of the FF. will produce the optimal welfare for the society? A. Marginal private gain + Marginal social gain = Marginal private cost + Marginal social cost B. Marginal private gain = Marginal social cost in the presence of positive externalities C. Marginal private gain = Marginal social cost in the presence of negative externalities D. Marginal private gain + Marginal social gain < Marginal private cost + Marginal social cost E. no correct answer
The market below depicts supply, demand and marginal social cost in the widget market. 1.00 HA 0.90 0.80 0.70 0.00 0.50 0.40 0.30 020 H 25 50 75 Pemi I 100 125 150 175 200 To correct for the externality, what should be used? O a. A subsidy of $0.20 b. A tax of $0.20 OC. A subsidy of $0.30 Od. A tax of $0.30
Which of the following statements is correct? a. Marginal external cost equals marginal private cost minus marginal social cost. b. Marginal social cost plus marginal external cost equals marginal private cost. c. Marginal social cost minus marginal private cost equals marginal external cost. d. Marginal social cost plus marginal private cost equals marginal external cost.