A positive externality will cause a market to produce Select one: more than is socially desirable. O b. more than the same market would produce in the presence of a negative externality. O c. less than is socially desirable. O d. the socially optimal equilibrium amount. a.

A positive externality will cause a market to produce Select one: more than is socially desirable. O b. more than the same market would produce in the presence of a negative externality. O c. less than is socially desirable. O d. the socially optimal equilibrium amount. a.

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

See similar textbooks

Related questions

Q: ECONOMICS UPVOTE WILL BE GIVEN. PLEASE CHOOSE THE CORRECT ANSWER. NO LONG EXPLANATION NEEDED. A…

A: Production cost is the main component to decide the level of production and price of goods. It is…

Q: If we wanted to make the statement that a particular point on a production possibility ter was DULIT…

A: A point is said to be productive and efficient if it lies on the production possibility frontier.…

Q: b(Y)=400Y-6Y2 c(Y)=5y2

A: Only the functions have changed so we will follow the same procedure as before and get the answer.…

Q: What is the effect of a price ceiling on the quantity demanded of a product? what is the effect of…

A: The maximum price that is set by the government for a particular commodity and services is called…

Q: If there is a decrease in supply and demand, how will equilibrium price and quantity be affected?

A: If there is a decrease in supply and demand, equilibrium price and quantity will be affected…

Q: Use either a shift in demand of supply to GRAPHICALLY represent each of the following situations.…

A: “Since you have posted a question with multiple sub-parts, we will solve the first three sub-parts…

Q: Allocative efficiency is achieved Group of answer choices a. at the point where the supply and…

A: Ans. Allocative efficiency is achieved when all goods and services are efficiently obtained by all…

Q: 1. a) If population 16 or older in Germany is = 70,159,000 and labor force participation rate (LFPR)…

A: Given population 16 or older = 70,159,000 Labor force participation rate = 56.43 % Size of labor…

Q: DESCRIPTIVE STATISTICS Table 2.30 Frequency Distribution of Family Incomes Family Income, $…

A: Table: Calculatuon for Q1, Q3 and 60th percentile

Q: Indicate price elasticities of demand for the points in the following graph:

A: Price elasticity of demand refers to the degree of responsiveness of quantity demanded of a…

Q: After graduating high school, Nicole chose to go to college, while Pedro chose to work full time.…

A: Opportunity cost The possible benefits that a person, investor, or business forgo while choosing…

Q: game. Find all the pure strategy and mixed strategy Nash equilibria in the following Player 2 M R…

A: Pure Strategy Nash Equilibrium gives us the best response/action given what the other player is…

Q: Explain what you believe is common to successful entrepreneurs and what the evolution of…

A: An entrepreneur is a person who decides to take the risk of Starting a new business. Entrepreneur is…

Q: The federal government changes its bank regulations in a way that makes it cheaper and easier for…

A: Here, it is given that the changes in the bank regulations by federal government will make it easier…

Q: Breakfast cereal is produced by "Healthy Morning," and let's assume that it has a crowded market.…

A: Total revenue is calculated by multiplying the cost of an item or service by its quantity. The…

Q: The following paragraphs discuss the impact of various economic events on the exchange rate.…

A: Exchange rates are defined as the rate at which a certain currency will be exchanged for another…

Q: Use the graph input tool to help you answer the following questions. You will not be graded on any…

A: Union wage is higher than equilibrium wage where number of workers supplied is equal to number of…

Q: A movie theater estimates that the price elasticity of demand for evening movie tickets is 1.22. If…

A: Elasticity measures the responsiveness of quantity demanded with respect to change in price. It is…

Q: Identify and describe the four stages of the ‘Economic Cycle’.

A: Economic Cycle is defined as a cycle which refers to the fluctuations in an economy between the…

Q: What are the examples of opportunity costs that the following groups of people face? Give specific…

A: PART A. Respiratory therapy: The opportunity cost for a respiratory therapist may be the time…

Q: Do firms really calculate marginal cost and marginal revenue to find the profit-maximizing output?…

A: Total revenue is the total receips collected from the sale of goods and services in the market.…

Q: 4. Good X Y Z Quantity 10 20 5 Price in 1999 $5 $10 $6 Price in 2000 $6 $10 $10 Assume year 2000 is…

A: The consumer price index (CPI) measures changes over the long run in the general degree of costs of…

Q: 10 basic goods and services needed by people

A: Goods:- It can be anything from supplies,merchandise, raw materials to already finished products.…

Q: A piece of construction equipment will cost $6,000 new and will have an expected life of 8 years,…

A: Equipment Cost = 6,000 Other Cost 1st Year and 2nd Year each = 1500 3nd Year = 1700 4th Year = 1900…

Q: Following the Second World War and prior to about 1980 most western economies? a. Had low income…

A: d. had open borders so that goods, services and people moved freely around the world.…

Q: 2.103 Lifetime Savings Accounts, known as LSAS, allow people to invest after-tax money without being…

A: Initially deposit = 10,000 deposit increases every year by 1000 r = 12% n = 6 years

Q: What we can conclude from the Consumption and Islamic Moral Principles in Islamic Economics

A: Introduction Although there are many ways to define consumption, the best way to put it is as a…

Q: Why do bars offer free peanuts?

A: Bars tend to increase the demand for drinks and beers through the various incentives and…

Q: The fact that more and more women are seeking job has only compounded the problem of unemployment.…

Q: Solve the linear programming problem. (If there is no solution, enter NO SOLUTIO ION.) Maximize z =…

A: we have the following inequality: x + y <= 1013x + y <= 129y>= 22x,y >= 0 Drawing…

Q: 3. a. Use the mathematical expression for eqm Y for an open economy (Y=C+I+G+X-IM) to explain what…

A: The market value of all final goods and services produced in a nation over a certain time period is…

Q: Suppose that good X is on the x-axis and good Y is on the y-axis. Suppose that the consumer has an…

A: A budget line represents all the combinations of two goods and services that a consumer can buy…

Q: QUESTION 8 Suppose that the government deficit is 10, interest on the government debt is 5, taxes…

Q: Given the following data, use present worth analysis to find the best alternative, A, B, or C. Use…

A: Present worth analysis explains the amount which explains the current cost of the alternatives here…

Q: When Sean visited his grandparents in Edinburgh, Scotland, over the summer, he noticed that things…

A: Here, it is given that Sean went to his grandparents house in Edinburgh, and seen that a Starbuck…

Q: When the government receipts are more than the government expenditure we call it as Surplus budget…

A: "In an economy, government makes expenditure which means government spends money on commodities and…

Q: construction. The contractor found 2 possible sources for the gravel with the following data:…

A: In economic matters, total cost (TC) is the base dollar cost of creating some amount of result. This…

Q: 2. Discouraged workers Which of the following statements correctly describe discouraged workers? (If…

A: Discouraged workers refer to those people who are tired of finding a job but they do have a desire…

Q: 3. In order to restructure some of its debt, General Motors decided to pay off one of its short-term…

A: Question 3 The total cost of repaying the loan in one year is $82 million Rate of interest for this…

Q: Money is O government bonds and stocks. any assets widely used and accepted as payment. bank…

A: The money is the center of the wheel of fortune. All economies are built on the exchange of money…

Q: Personal Taxes Social Security Contributions Rents Taxes on Production & Imports Corporate Income…

A: The gross domestic product (GDP) is a measure that attempts to capture a country's economic output.…

Q: One of the important features of this model is the mechanism by which technology is transferred from…

A: Since you have posted multiple questions, we will answer the first question for you. If you want any…

Q: 2.31 A firm pays 5/12 of its labor force an hourly wage of $5, 1/3 of the labor force a wage of $6,…

Q: From Table 1.1.6 (Chained Dollars), what was GDP in the year 2000 (billions of dollars)?

A: GDP or gross domestic product is the value of final goods and services produced within an economy in…

Q: A company produces a single, high-volume product. One year its production volume was 780,000 units,…

A: Here, given information is: Production volume in a year: 780,000 units Fixed cost: Php 160 million…

Q: 5. Understanding risk aversion Suppose your friend Juanita offers you the following bet: She will…

A: The utility capability of a gamble unwilling individual displays the law of decreasing minor…

Q: What causes the shift in the budget below, from budget Bo to B₁? Good A B₁ Bo Good C O A decrease in…

A: Microeconomics refers to the study of what is likely to happen when individuals make choices in…

Q: 1. P 1.00 is the principal which is invested at a nominal rate of 8% semi- annually. After one year…

Q: Suppose US Air has two classes of potential customers, holiday travellers and business travellers.…

A: Profit is the amount over and above the cost. Profit = Revenue - Cost

Q: At mid-year 2018, the annual growth rate in Pakistan was 1.4%. What is your estimate of the per…

A: Gross Domestic Product (GDP) measures the value of final goods and services produced in a nation in…

Question

A positive externality will cause a market to produce
Select one:
more than is socially desirable.
O b. more than the same market would produce
in the presence of a negative externality.
O c. less than is socially desirable.
O d. the socially optimal equilibrium amount.
a.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step 3

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 3 steps with 3 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Property Rights, Bargaining And The Coase Theorem

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

Show the market for cigarettes in equilibrium, assuming that there are no laws banning smoking in public. Label the equilibrium private market price and quantity as Pm and Qm. Add whatever is needed to the model to show the impact of the negative externality from second-hand smoking. (Hint: In this case it is the consumers, not the sellers, who are creating the negative externality.) Label the social optimal output and price as Fe and Qe. On the graph, shade in the deadweight loss at the market output.
(a) Explain the difference between a positive externality and a negative externality and why each result in an equilibrium point that is not optimal for society. (b) which externality results in an equilibrium quantity that is higher than the optimal social quantity of a good? (c) how can the impact of the externality in part b be corrected?
What is an external benefit? An external benefit is a benefit that OA. always equals external cost OB. experiences increasing marginal returns C. affects someone other than the buyer of a good OD. is greatest at the equilibrium point
Q.1 in case of positive externality, the rule for the Social welfare Maximization. Select one: O.a. None of these options O.b. MB MC O.C. MB-MSC O.d. MSB MC Clear my choice Q. 2 Market mechanisms are unlikely to provide Select one: O.a. None of these options O.b. nonrival goods efficiently. O.c. Supply and Demand O.d. prices. Q. 3 When it will be difficult to reach o privote solution for m Solect one Oa externolitios invisible b transoctions costs low c transoctions costs high dexteholities viiblee CleaLmY cbaice
For a product with external benefits like vaccines (positive externality),which of the following is true?Select one: Oa. The market equilibrium results in too much of the good compared to what is optimalOb. The market equilibrium results in too little of the good compared to what is optimal.Oc. The market will not provide the good; it must be publicly funded.O d. Large economies of scale work as a barrier to firm entry.
a. Suppose a market is introduced for the externality Eveline causes on Victor. Let us denote by px the price of this externality. Suppose "property rights" are assigned such that Victor has the right not to experience the smell of cooked cabbage. The competitive equilibrium price ratios pm and Px are equal to? b. Derive the market allocation corresponding to the new competitive equilibrium of the economy formed by Eveline and Victor (ce, me) and (cv,mv). c. Is the new competitive equilibrium Pareto efficient?
3. Consider the production and sale of Good C. There are NO externalities associated with the production or consumption of Good C. Assume that Good C is sold in a competitive market. Thus, you can assume that the S Curve = Cost Curve, and that the D Curve = WTP Curve. You are told that the following points are on the Demand and Supply schedules( and thus also are points on the Demand and Supply Curves) for Good C: Price Qty. Demanded Qty. Supplied $ 3000 28 58 $ 2750 30 55 $ 2500 32 52 $ 2250 34 49 $ 2000 36 46 $ 1500 40 40 $ 1000 44 34 $…
4. Please explain: a. Why positive externalities as a market failure. Explain how subsidy works on this condition. Give the example of positive externalities also show in the curve. b. How to find nash equilibrium or equilibria
Consider two ways to protect your car from theft.The Club (a steering wheel lock) makes it difficult fora car thief to take your car. Lojack (a tracking system)makes it easier for the police to catch the car thiefwho has stolen it. Which of these methods confersa negative externality on other car owners? Whichconfers a positive externality? Do you think there areany policy implications of your analysis?
Suppose that we are considering the market for windmills. The private demand for electric cars is given buy: ?d = 160 − 2? And the private supply of electric cars is given by: ?s = ? − 20Suppose also that electrci cars produce a positive externality, with a Marginal Economic Benefit of $30 per unit. 5. What would be the private market equilibrium (p* & Q*)? 6. What is the socially optimal equilibrium (p* & Q*)? 7. What is Producer Surplus and Consumer Surplus in the private market equilibrium? 8. What is the increase in Total Surplus from moving from the private market equilibrium to the socially optimal equilibrium?
Suppose that we are considering the market for electric cars The private demand for cars is given buy: ? = 160 − 2? And the private supply of electric cars is given by: ? = ? − 20Suppose also that electric cars produce a positive externality, with a Marginal Economic Benefit of $20 per unit. 1. What would be the private market equilibrium (p* & Q*)? 2. What is the socially optimal equilibrium (p* & Q*)? 3. What is Producer Surplus and Consumer Surplus in the private market equilibrium? 4. What is the increase in Total Surplus from moving from the private market equilibrium to the socially optimal equilibrium?
(J) Suppose the production process of a particular good creates a negative externality such as pollution. Other things being equal, would society be better off if this good were produced by a perfectly competitive market or by a monopoly? a. Society would be better off if this good were produced by a perfectly competitive market, because a perfectly competitive market responds to consumers' desires in the long run b. Society would be better off if this good were produced by a perfectly competitive market, because a perfectly competitive market will produce the quantity where Marginal Revenue equals Marginal Cost c. Society would be better off if this good were produced by a monopoly,