The public goods and private goods from the given data.

Question

Want to see more full solutions like this?

Answer 1

Question

Chapter 4, Problem 1DQ

Summary Introduction

To determine: The public goods and private goods from the given data.

Expert Solution & Answer

Explanation of Solution

a. Wilderness area

This is a pure public good. At certain point, this area has minimal human activity and usually referred to as wild area. This area is usually owned by a firm or individuals. Also, this is non- excludable.

b. Satellite television

This is a impure public good. Satellite televisions are non rival in consumption, though it is excludable.

c. Medical school education

This is a private good depending on the conditions. Any individual from society can get educated by meeting the required criteria. These criteria can result in public good and any person can avail it.

d. Public television programs

Television signals are non-rival in consumption and non-excludable when programs are broadcasted over the air. Hence, they are public good.

e. Automated teller machine (ATM)

This is a private good. An ATM machine is rival in consumption, at-least during peak hours. It is excludable as only certain customers who have ATM cards can use the machine.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Students have asked these similar questions

Delta Corporation has the following capital structure: Cost Weighted (after-tax) Weights Cost Debt 8.1% 35% 2.84% Preferred stock (Kp) 9.6 5 .48 Common equity (Ke) (retained earnings) 10.1 60 6.06 Weighted average cost of capital (Ka) 9.38% a. If the firm has $18 million in retained earnings, at what size capital structure will the firm run out of retained earnings? b. The 8.1 percent cost of…

Dillon Enterprises has the following capDillon Enterprises has the following capital structure. Debt ........................ 40% Common equity ....... 60 The after-tax cost of debt is 6 percent, and the cost of common equity (in the form of retained earnings) is 13 percent. What is the firm’s weighted average cost of capital? a. An outside consultant has suggested that because debt is cheaper than equity, the firm should switch to a capital structure that is 50 percent debt and 50 percent equity. Under this new and more debt-oriented arrangement, the after-tax cost of debt is 7 percent, and the cost of common equity (in the form of retained earnings) is 15 percent. Recalculate the firm’s weighted average cost of capital. b. Which plan is optimal in terms of minimizing the weighted average cost of capital?

Compute Ke and Kn under the following circumstances: a. D1= $5, P0=$70, g=8%, F=$7 b. D1=$0.22, P0=$28, g=7%, F=2.50 c. E1 (earnings at the end of period one) = $7, payout ratio equals 40 percent, P0= $30, g=6%, F=$2,20. Note: D1 is the earnings times the payout rate. d. D0 (dividend at the beginning of the first period) = $6, growth rate for dividends and earnings (g)=7%, P0=$60, F=$3. You will need to calculate D1 (the dividend after the first period).

Answer 2

Question

Chapter 4, Problem 1DQ

Summary Introduction

To determine: The public goods and private goods from the given data.

Expert Solution & Answer

Explanation of Solution

a. Wilderness area

This is a pure public good. At certain point, this area has minimal human activity and usually referred to as wild area. This area is usually owned by a firm or individuals. Also, this is non- excludable.

b. Satellite television

This is a impure public good. Satellite televisions are non rival in consumption, though it is excludable.

c. Medical school education

This is a private good depending on the conditions. Any individual from society can get educated by meeting the required criteria. These criteria can result in public good and any person can avail it.

d. Public television programs

Television signals are non-rival in consumption and non-excludable when programs are broadcasted over the air. Hence, they are public good.

e. Automated teller machine (ATM)

This is a private good. An ATM machine is rival in consumption, at-least during peak hours. It is excludable as only certain customers who have ATM cards can use the machine.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 3

Question

Chapter 4, Problem 1DQ

Summary Introduction

To determine: The public goods and private goods from the given data.

Expert Solution & Answer

Explanation of Solution

a. Wilderness area

This is a pure public good. At certain point, this area has minimal human activity and usually referred to as wild area. This area is usually owned by a firm or individuals. Also, this is non- excludable.

b. Satellite television

This is a impure public good. Satellite televisions are non rival in consumption, though it is excludable.

c. Medical school education

This is a private good depending on the conditions. Any individual from society can get educated by meeting the required criteria. These criteria can result in public good and any person can avail it.

d. Public television programs

Television signals are non-rival in consumption and non-excludable when programs are broadcasted over the air. Hence, they are public good.

e. Automated teller machine (ATM)

This is a private good. An ATM machine is rival in consumption, at-least during peak hours. It is excludable as only certain customers who have ATM cards can use the machine.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 4

Question

Chapter 4, Problem 1DQ

Summary Introduction

To determine: The public goods and private goods from the given data.

Expert Solution & Answer

Explanation of Solution

a. Wilderness area

This is a pure public good. At certain point, this area has minimal human activity and usually referred to as wild area. This area is usually owned by a firm or individuals. Also, this is non- excludable.

b. Satellite television

This is a impure public good. Satellite televisions are non rival in consumption, though it is excludable.

c. Medical school education

This is a private good depending on the conditions. Any individual from society can get educated by meeting the required criteria. These criteria can result in public good and any person can avail it.

d. Public television programs

Television signals are non-rival in consumption and non-excludable when programs are broadcasted over the air. Hence, they are public good.

e. Automated teller machine (ATM)

This is a private good. An ATM machine is rival in consumption, at-least during peak hours. It is excludable as only certain customers who have ATM cards can use the machine.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 5

Chapter 4, Problem 1DQ

Summary Introduction

To determine: The public goods and private goods from the given data.

Expert Solution & Answer

Explanation of Solution

a. Wilderness area

This is a pure public good. At certain point, this area has minimal human activity and usually referred to as wild area. This area is usually owned by a firm or individuals. Also, this is non- excludable.

b. Satellite television

This is a impure public good. Satellite televisions are non rival in consumption, though it is excludable.

c. Medical school education

This is a private good depending on the conditions. Any individual from society can get educated by meeting the required criteria. These criteria can result in public good and any person can avail it.

d. Public television programs

Television signals are non-rival in consumption and non-excludable when programs are broadcasted over the air. Hence, they are public good.

e. Automated teller machine (ATM)

This is a private good. An ATM machine is rival in consumption, at-least during peak hours. It is excludable as only certain customers who have ATM cards can use the machine.

Answer 6

Chapter 4, Problem 1DQ

Summary Introduction

To determine: The public goods and private goods from the given data.

Expert Solution & Answer

Explanation of Solution

a. Wilderness area

This is a pure public good. At certain point, this area has minimal human activity and usually referred to as wild area. This area is usually owned by a firm or individuals. Also, this is non- excludable.

b. Satellite television

This is a impure public good. Satellite televisions are non rival in consumption, though it is excludable.

c. Medical school education

This is a private good depending on the conditions. Any individual from society can get educated by meeting the required criteria. These criteria can result in public good and any person can avail it.

d. Public television programs

Television signals are non-rival in consumption and non-excludable when programs are broadcasted over the air. Hence, they are public good.

e. Automated teller machine (ATM)

This is a private good. An ATM machine is rival in consumption, at-least during peak hours. It is excludable as only certain customers who have ATM cards can use the machine.

Answer 7

Chapter 4, Problem 1DQ

Summary Introduction

To determine: The public goods and private goods from the given data.

Answer 8

Expert Solution & Answer

Explanation of Solution

a. Wilderness area

This is a pure public good. At certain point, this area has minimal human activity and usually referred to as wild area. This area is usually owned by a firm or individuals. Also, this is non- excludable.

b. Satellite television

This is a impure public good. Satellite televisions are non rival in consumption, though it is excludable.

c. Medical school education

This is a private good depending on the conditions. Any individual from society can get educated by meeting the required criteria. These criteria can result in public good and any person can avail it.

d. Public television programs

Television signals are non-rival in consumption and non-excludable when programs are broadcasted over the air. Hence, they are public good.

e. Automated teller machine (ATM)

This is a private good. An ATM machine is rival in consumption, at-least during peak hours. It is excludable as only certain customers who have ATM cards can use the machine.