In a town of two people, Ben and Tem (bear with me on this, okay) the city is trying to decide how many acres to devote to the public park. Ben's demand function is QA = 20 - p and Tem demand TD = 20 function is QD = 26 – 20p, where Q is measured in acres and p is measured in dollars. Acres are supplied according to the function p 10 + 60Q. a. Calculate the Pareto efficient size of the park in acres. b. Assuming that both Ben and Tem are truthful, how much would each pay for the efficient size of the park? What would be the total amount paid by the group? c. Sketch a diagram that shows each person's demand for acres and the Pareto efficient outcome.

In a town of two people, Ben and Tem (bear with me on this, okay) the city is trying to decide how many acres to devote to the public park. Ben's demand function is QA = 20 - p and Tem demand TD = 20 function is QD = 26 – 20p, where Q is measured in acres and p is measured in dollars. Acres are supplied according to the function p 10 + 60Q. a. Calculate the Pareto efficient size of the park in acres. b. Assuming that both Ben and Tem are truthful, how much would each pay for the efficient size of the park? What would be the total amount paid by the group? c. Sketch a diagram that shows each person's demand for acres and the Pareto efficient outcome.

Economics (MindTap Course List)

13th Edition

ISBN:9781337617383

Author:Roger A. Arnold

Publisher:Roger A. Arnold

Chapter30: Market Failure: Externalities, Public Goods, And Asymmetric Information

Section30.2: Internalizing Externalities

Problem 2ST

See similar textbooks

Similar questions

Remaining Time: S Suppose the demand for Apples is given by QA = 240 - 8 PA and the current market price is 25. %3D Calculate consumer surplus. 100 Correct response: 100 If the market price increases to 29 calculate consumer surplus. 4 Correct response: 4 What is the compensating variation assocated with a loss of access to the apple market at the initial price of 25? Assume demand remains constam What is the compensating variation associated with the increase in price from 25 to 29? Assume demand remains constant. Section Attempt 1 of 1 Verity
The market demand for productXis given by: \[ Q_{d}=6-1 / 2 P \text { or } P d=12-2 Q \] The market supply for goodXis given by: \[ Q_{s}=-14+2 P \text { or } P s=7+1 / 2 Q \] whereP=price per unit andQis number of units. Draw a supply-and-demand graph with these curves. 1.) Using the line drawing tool, draw the supply and demand curves. Properly label your lines. 2.) Using the point drawing tool, plot the equilibrium point. Label your point 'E'. Note: Carefully follow the instructions above and only draw the required objects. The equilibrium price is$and the equilibrium quantity is unit(s). (Enter your responses as integers.) A per-unit excise tax is imposed on suppliers of productX, and the market supply with the tax is now given by: \[ Q_{s}=-19+2 P \text { or } P s=9.50+1 / 2 Q \] Using the graph on the right, show this supply curve. 1.) Using the line drawing tool, draw the new supply curve. Label your line 'S1+tax'.1. Note: Carefully follow the instructions above and only draw…
-How has Covid-19 affected the market for gasoline? Which of the main influences of supply and demand do you think were responsible for the price changes? (See textbook pages 90-91 and 97-98.) Be specific and explain why and how the “main influences” you chose had an impact on the gasoline market.
Q2 solution needed i need in words not handwritten solution Q1: The October 30th, 2021 edition of The Economist included an article titled “As EnergyPrices Spike, Governments Reach for the Dirtiest Tool in the Box.” (It is not necessary foryou to read the article; we will provide all relevant information in the questions we ask).The “dirty tool” in question is fossil-fuel subsidies. For Question 1, consider the marketfor natural gas in January 2020, prior to the onset of the Covid pandemic and before anychanges described in The Economist article. Assume that in January 2020, natural gasprices were in a short-run equilibrium.• Draw a graph that shows supply and demand analysis for gas in January2020. This graph will serve as a starting point for your analysis inQuestions 2, 3, 4, and 5.• In drawing this graph, please assume that the demand curve is downwardsloping and the supply curve is upward sloping.• Clearly show the market equilibrium in January 2020.• Please remember to clearly…
As most classes are occurring remotely at UHH this term, parking on campus has not been a concern. Normally, UHH offers parking passes that must be purchased and which can only be used in certain areas. The areas closest to classroom buildings are either restricted to faculty or sell out quickly. There is very little off-campus parking within easy walking distance. Can you come up with a system that provides a more efficient solution to the parking problem at UHH? Should prices be increased to develop a fund to create more parking areas? Should prices be reduced and a lottery system established which would mean there may be people excluded from parking on campus? Could parking passes be allocated on a household basis rather than on a per student basis encouraging carpooling. What ideas do you have for more efficient allocation of parking on campus?
7. There is a road named High Street with 800m long. There are two grocery shops: Woolworths located at the left end and Coles located at the right end. 4800 customers are uniformly distributed along High Street. To make our life easier, assume both grocery stores sell the same product, and consumers demand just one unit of the product. Traveling to a grocery shop is costly, and the cost of traveling is 4 cents per meter. Suppose the price of the product is $10 at Woolworths, and $12 at Coles. Then customers will purchase the product from Woolworths.
When allocating water, efficiency in the presence of competing uses implies: O Consideration of the oportunity cost imposed on an alternate user. The marginal net benefit should be equalized across all users. O The price of the good is equal to the marginal net benefits. All of these reasons
Please refer to the figure below. The equation for p = 105-0.005D %3D 25,000+65D W Y D (units sold) How much is the optimum demand for the commodity if p = 105 – 0.005D? O A. 4000 О В. 4200 О С. 4300 O D. 4500 Cost/Revenue
2. only
3. The figure shows supply and demand for planting trees, based on private costs and private value. Trees sequester carbon, meaning that they help counteract pollutants that contribute to climate change. Supply is given by P=(1/5)Q+4. Price of trees ($) 16 vlleiona sdi toode grind of gaitneleon oxibiadua Insamovog od bluoria doum woll > (laval lernitqo siooz - love pioiflo aniH) Sninaly sou to level insioifto Quantity of trees 80 Vanui D=PV=SV a. Suppose that the carbon sequestration that results from planting a tree is worth $4. Graph the social cost curve for tree planting that accounts for the positive externality indo of trees. O noitesubs sgo lovel yus 101 aftened steving sdh besoxs noitesubs 02/20 exibiadure of me 1944an2be agellos to innome insisifie yllisimmanoce sil oiterubo ogollos to calv b. Ignoring the positive externality, how many trees will be planted? uba
The figure below shows the demand curve for a U.S. farmer for irrigating his land. It costs $100 per acre to irrigate the land. Each acre of land irrigation generates salty runoff that winds up in the Colorado River. It costs $50 to desalinate this river water so Mexican farmers can irrigate their crops. Price ($) 275 250 225 200 175 150 125 100 75 50 25 0 DMBMB sed 10 20 30 40 50 60 70 80 90 100110120 Irrigation (acres) Tools (2) MCpvt MC social
The price of crude oil increased to its highest level due to conditions which impactedsupply. Historically, crude oil has traded at between 70 and 150 USD per barrel. But theprice increased to over 200 USD in March 2022. Growing demand in Canada for crude tobe turned into refined petroleum, coupled with a sharp fall in production in Saudi Arabiahave both been factors in the price increase. Bauxite production in Saudi Arabia for 2017-18 fell 65% year-on-year due to an agreement with OPEC. The Energy InformationAdministration predicts that global consumption of crude oil is likely to be greater thanproduction by 20 million barrels this year.In the US, companies in the steel and alumina industry have put pressure on the USgovernment to relax import controls, warning that otherwise they might run out of petrol.Commentators predict that most steel and alumina producers will be unaffected becausecrude is such a small part of their spending.a. Explain, using supply and demand analysis, why…