MICROECONOMICS (LL)-W/ACCESS >CUSTOM<
MICROECONOMICS (LL)-W/ACCESS >CUSTOM<
11th Edition
ISBN: 9781264207718
Author: Colander
Publisher: MCG CUSTOM
Question
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Chapter 8, Problem 12QE

(a)

To determine

Graphical representation of an individual demand curve and market demand curve for public goods.

(b)

To determine

Doubt regarding the individual demand curves for public goods.

(c)

To determine

Calculate the socially optimal amount of the public good.

(d)

To determine

Impact of the free rider problem.

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Students have asked these similar questions
how do you read this type of graph and know whats going on
Suppose there are two residents in a neighborhood, and you know both of their demand curves for a public good. What would you have to do in order to figure out what the social demand curve? A.Multiply the two demand curves together   B.Add their demand curves together   C.Subtract the demand of the person with the lower valuation of the public good from the demand of the person with the higher valuation of the public good   D.Subtract the demand of the person with the higher valuation of the public good from the demand of the person with the lower valuation of the public good
What is an externality?  How do they affect market efficiency?  If an externality is present, where is the socially optimal point of production?  Where will the market produce if there is no government intervention?  How do we get from the private market equilibrium to the socially optimal one?

Chapter 8 Solutions

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