Principles of Economics 2e
Principles of Economics 2e
2nd Edition
ISBN: 9781947172364
Author: Steven A. Greenlaw; David Shapiro
Publisher: OpenStax
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Chapter 12, Problem 41P

Refer to Table 12.2. The externality created by the refrigerator production was $ 1 00 .

However, once we accounted for both the private and additional external costs, the market price increased by only $ 5 0 .

If the external costs were $ 1 00 why did the price only increase by $ 5 0 when we accounted for all costs?

Chapter 12, Problem 41P, Refer to Table 12.2. The externality created by the refrigerator production was 100. However, once

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Refer to Table 12.2. The externality created by the refrigerator production was $100. However, once we accounted for both the private and additional external costs, the market price increased by only $50. If the external costs were $100 why did the price only increase by $50 when we accounted for all costs? Price Quantity Demanded Quantity Supplied before Considering Pollution Cost Quantity Supplied after Considering Pollution Cost $600 50,000 40,000 30,000 $650 45,000 45,000 35,000 $700 40,000 50,000 40,000 $750 35,000 55,000 45,000 $800 30,000 60,000 50,000 $850 25,000 65,000 55,000 $900 20,000 70,000 60,000 Table12.2 A Supply Shift Caused by Pollution Costs
Refer to the following table. The externality created by the production of refrigerators was $100. However, once both the private and additional external costs were taken into consideration, the market price increased by only $50. If the external costs were $100 why did the price only increase by $50 when all the costs were taken into account?                                                                             Price  =  $600, $650, $700, $750, $800, $850, $900                                                 Quantity Demanded = 50,000, 45,000, 40,000, 35,000, 30,000, 25,000, 20,000   Quantity Supplied before Considering Pollution Cost = 40,000, 45,000, 50,000, 55,000, 60,000, 65,000, 70,000                                                                                     Quantity Supplied after Considering Pollution Cost = 30,000, 35,000, 40,000, 45,000, 50,000, 55,000, 60,000
Economics MPB (Marginal Private Benefit) =20-4Q (like a Demand Equation). MPC (Marginal Private Cost) = 4+2Q (like a Supply Equation). MEB (Marginal External Benefit) = 0 (an external benefit is a positive externality). MEC (Marginal External Cost) = 0.5Q(an external cost is a negative externality). Suppose Power for Health Earth owned the rights to pollute the atmosphere of the City of Atlanta, and it is negotiating with concerned residents willing to pay the company (Great Power) to produce less coal energy. For the 8th unit of coal energy, determine the range within which payment would be acceptable to Great Power and the concerned residents. %3D 1.) Show the following in the graph: a. the 8th unit b. the unit price Great Power would take c. the unit price the concerned residents would раy PLEASE HELP

Chapter 12 Solutions

Principles of Economics 2e

Ch. 12 - The state of Colorado requires oil and gas...Ch. 12 - Consider the case of global environmental problems...Ch. 12 - A country called Sherwood is very heavily covered...Ch. 12 - What is an externality?Ch. 12 - Give an example of a positive externality and an...Ch. 12 - What is the difference between private costs and...Ch. 12 - In a market without environmental regulations,...Ch. 12 - What is command-and-control environmental...Ch. 12 - What are the three problems that economists have...Ch. 12 - What is a pollution charge and what incentive does...Ch. 12 - What is a marketable permit and what incentive...Ch. 12 - What are better-defined property rights and what...Ch. 12 - As the extent of environmental protection expands,...Ch. 12 - As the extent of environmental protection expands,...Ch. 12 - What are the economic tradeoffs between low-income...Ch. 12 - What arguments d0 low-income countries make in...Ch. 12 - In the tradeoff between economic output and...Ch. 12 - What does a point inside the production...Ch. 12 - Suppose you want to put a dollar value on the...Ch. 12 - Would environmentalists favor command-and-control...Ch. 12 - Consider two ways of protecting elephants from...Ch. 12 - Will a system of marketable permits work with...Ch. 12 - Is zero pollution possible under a marketable...Ch. 12 - Is zero pollution an optimal goal? Way or why not?Ch. 12 - From an economic perspective, is it sound policy...Ch. 12 - Recycling is a relatively inexpensive solution to...Ch. 12 - Can extreme levels of pollution hurt the economic...Ch. 12 - How can high-income countries benefit from...Ch. 12 - Technological innovations shift the production...Ch. 12 - Show the market for cigarettes in equilibrium,...Ch. 12 - Refer to Table 12.2. The externality created by...Ch. 12 - Table 12.12, shows the supply and demand...Ch. 12 - A city currently emits 15 million gallons (MG) of...Ch. 12 - In the Land of Purity, there is only one form of...
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