А. What is the competitive equilibrium price and quantity of straws? B.: It turns out that straws cause a negative externality because they are not properly disposed of. The marginal damages (external cost) from straws are: MD = 4Q What is the social marginal cost of straws? C. ' ' What is the efficient number of straws? D. (" Which area on the graph below corresponds to the welfare loss from the competitive

А. What is the competitive equilibrium price and quantity of straws? B.: It turns out that straws cause a negative externality because they are not properly disposed of. The marginal damages (external cost) from straws are: MD = 4Q What is the social marginal cost of straws? C. ' ' What is the efficient number of straws? D. (" Which area on the graph below corresponds to the welfare loss from the competitive

Microeconomics: Private and Public Choice (MindTap Course List)

16th Edition

ISBN:9781305506893

Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson

Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson

Chapter5: Difficult Cases For The Market And The Role Of Government

Section: Chapter Questions

Problem 10CQ

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ASAP plz Why don't people/stores make different decisions? Cost is a factor: a case of foam take-out containers costs $25, compared with $58 for paper and recyclable-plastics. How does this affect the firm's profit? Are consumers willing to pay more? Negative externality Consider the demand and supply given above. Suppose there is an external cost given by MEC=5Q. Find social equilibrium price and quantity. Draw a graph and label both private and social equilibrium.
An increase in globalization has lead to an increase in pollution, and this is a problem because pollution is seen to be the classic example of a This is a that individuals impose on others but do not pay for. O negative externality, cost O possitive externality, benefit O negative externality, benefit O possitive externality, cost
An externality exists whenever O the economy can benefit from government intervention. a person engages in an activity that influences the well-being of a bystander and yet neither pays nor receives payment for that effect. O markets are not able to reach equilibrium. O a firm sells its product in a foreign market.
Suppose that a mayor of a large city believes strongly that education provides great benefits to the community andurges the state government to provide the district with more money. An economist would say that this reflects theMayor's belief that:Asince teachers are overpaid, the district needs more money to hire enough teachers for its classrooms.Bthere are positive external benefits associated with education.Cthere are nontrivial external costs associated with education.Dpublic schools provide a higher quality education than private schools.
Write down a model of positive production externality with two firms, in which theproduction activities of one firm directly affects the production/cost of the other firm.State and explain the key assumptions of the model. Using the model, answer thefollowing questions:(a) Explain why the presence of a positive production externality could prevent therealisation of an efficient outcome.(b) Name a possible cure for the positive production externality and explain how itcould solve the inefficiency problem.
Greater consumption of alcohol leads to more motorvehicle accidents and, thus, imposes costs on peoplewho do not drink and drive.a. Illustrate the market for alcohol, labeling thedemand curve, the social-value curve, thesupply curve, the social-cost curve, the marketequilibrium level of output, and the efficient levelof output.b. On your graph, shade the area corresponding tothe deadweight loss of the market equilibrium.(Hint: The deadweight loss occurs because someunits of alcohol are consumed for which the socialcost exceeds the social value.) Explain.
The following graph represents the market for high-emissions cars. Answer this question assuming that the externality is not internalised. Price of high tmissiens velides Sorial Value &, Quantity of high imissions vehidles What is the social cost of the last unit traded in the market? O P1 O P2 O P3 OP4 O OO0
Time left 0:53:28 Suppose that cookie producers create a positive externality equal to $2 per dozen. What is the relationship between the equilibrium quantity and the socially optimal quantity of cookies to be produced? tion 10 et rered ed out of Select one: ag stion O a. No relationship exists. O b. The equilibrium quantity is less than the socially optimal quantity. O c. The equilibrium quantity is greater than the socially optimal quantity. O d. They are equal. Next page revious page ser tour on this page KT
2 Which of the following best describes where total surplus is maximized when an extemality cxists in a market? Choose 1 answer: The quantity where marginal social cost equals marginal private benet. The quantity where marginal social benefit equas marginal private cost. The quantity where marginal social cost is higher than marginal private cost The quantity where marginal social benefit is higher than marginal private benefit The quantity where marginal social cost equals marginal social benet.
Question 38 Consider a market where production of the good is creating a negative externality. In the market equilibrium, there is a deadweight loss because the O social cost is greater than the internal benefit. O internal benefit is not equal to the external benefit. O internal cost of production is less than the social cost. O internal benefit is less than the internal cost. O internal cost of production is not equal to the internal benefit.
The following table describes the productionpossibilities of two cities in the country of Baseballia:Pairs of RedSocks per Workerper HourPairs of WhiteSocks per Workerper HourBoston 3 3Chicago 2 1a. Without trade, what is the price of white socks (interms of red socks) in Boston? What is the price inChicago?b. Which city has an absolute advantage in theproduction of each color sock? Which city has acomparative advantage in the production of eachcolor sock?c. If the cities trade with each other, which color sockwill each export?d. What is the range of prices at which mutuallybeneficial trade can occur?
qs abiv 30 ovo pilo 5. Oil spills from oceangoing tankers are rare but bring huge damages to coastlines when they occur within 200 miles of shore. Unfortunately, most tanker spills do occur on or near coasts. Rank the following alternatives according to how efficient they are in i jud, responding to the threat of oil spills. Explain your ranking. a. Each nation with an endangered coastline should impose a tax on all imported oil, a tax that raises enough revenue to compensate for any oil-spill damages. b. Each coastal nation should impose a tax on all domestically purchased oil, a tax that raises enough revenue to compensate for any oil-spill damages. c. Oil-carrying companies should be legally liable for all damages, in the courts of the countries whose national waters are polluted by the spills. d. Each coastal nation should intercept all oil tankers in national waters and charge them a fee that will cover the estimated costs of future oil spills.