2) The following table shows how the marginal benefit of a service varies for five consumers. Quantity 1 2 3 4 Samuel 150 125 100 75 Adam 125 100 75 50 Bronn 100 75 50 25 Michael 200 150 125 125 Matt 600 400 200 150 a) Derive the demand curve for this service assuming that it is a public good. b) If marginal cost of the good is 850, what is the efficient output of the public good? c) If marginal cost of the good is 425, what is the efficient output of the public good? d) If marginal cost of the good is 850, what is the efficient output assuming it is private good?

2) The following table shows how the marginal benefit of a service varies for five consumers. Quantity 1 2 3 4 Samuel 150 125 100 75 Adam 125 100 75 50 Bronn 100 75 50 25 Michael 200 150 125 125 Matt 600 400 200 150 a) Derive the demand curve for this service assuming that it is a public good. b) If marginal cost of the good is 850, what is the efficient output of the public good? c) If marginal cost of the good is 425, what is the efficient output of the public good? d) If marginal cost of the good is 850, what is the efficient output assuming it is private good?

Principles of Microeconomics

7th Edition

ISBN:9781305156050

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter11: Public Goods And Common Resources

Section: Chapter Questions

Problem 2PA

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