Microeconomics
21st Edition
ISBN: 9781259915727
Author: Campbell R. McConnell, Stanley L. Brue, Sean Masaki Flynn Dr.
Publisher: McGraw-Hill Education
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Question
Chapter 4, Problem 6DQ
To determine
The positive externalities.
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Students have asked these similar questions
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3. The weekly supply and demand for packs of cigarettes in Carcinia is given in Figure 18P-1. [
a. Suppose cigarette smoking causes a $6/pack external cost on non-smokers. Draw the demand
curve that would exist if the externality associated with smoking were internalized by
consumers.
b. How many packs of cigarettes are consumed per week?
c. What is the efficient number of cigarette packs?
d. What would be the total gain in surplus if this externality could be internalized?
FIGURE 18P-1
Price ($)
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36
34
32
30
18
16
14
12
10
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D
0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30
Packs of cigarettes (millions)
IN-CLASS
ACTIVITY 5
Suppose the equation for the demand curve in a market is P=100 – 2Q. Also, suppose the equation for the supply curve in the same market is P=10+3Q. Suppose there is an external cost of $20 associated with the
production of each unit of the good. The socially optimal quantity is
O 4 units smaller than the market equilibrium quantity.
O 22 units greater than the market equilibrium quantity
O 14 units smaller than the market equilibrium quantity
O 4 units greater than the market equilibrium quantity.
The graph shows the marginal social cost, supply, and demand curves in the hand sanitizer market. At what quantity could
the government set a quota to control this externality?
O 12
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8.
Chapter 4 Solutions
Microeconomics
Ch. 4.A - Prob. 1ADQCh. 4.A - Prob. 2ADQCh. 4.A - Prob. 3ADQCh. 4.A - Prob. 1ARQCh. 4.A - Prob. 2ARQCh. 4.A - Prob. 3ARQCh. 4.A - Prob. 1APCh. 4 - Prob. 1DQCh. 4 - Prob. 2DQCh. 4 - Prob. 3DQ
Ch. 4 - Prob. 4DQCh. 4 - Prob. 5DQCh. 4 - Prob. 6DQCh. 4 - Prob. 7DQCh. 4 - Prob. 8DQCh. 4 - Prob. 9DQCh. 4 - Prob. 1RQCh. 4 - Prob. 2RQCh. 4 - Prob. 3RQCh. 4 - Prob. 4RQCh. 4 - Prob. 5RQCh. 4 - Prob. 6RQCh. 4 - Prob. 7RQCh. 4 - Prob. 1PCh. 4 - Prob. 2PCh. 4 - Prob. 3PCh. 4 - Prob. 4PCh. 4 - Prob. 5PCh. 4 - Prob. 6PCh. 4 - Prob. 7P
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