Please see below. If possible, please include where the pieces of the graph go. Specialized electronic batteries, such as those for laptops, arehard to dispose of safely, yielding excess pollution when oneMarket for Laptop Batteriesgets throwncreates an external cost of $150 per unit. The accompanyingaway. Suppose that producing these batteries1,000950Supply900850diagram depicts the market for these batteries in which these800external costs are not internalized. Please adjust the750700appropriate curves to represent the market if the external costs650are internalized.600550500450400350300250200Demand150100501,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000QuantityPrice

When the production of batteries creates an external cost of $150 it refers to the cost to the…

Specialized electronic batteries, such as those for laptops, are hard to dispose of safely, yielding excess pollution when one Market for Laptop Batteries gets thrown away. Suppose that producing these batteries creates an external cost of $150 per unit. The accompanying 1,000 950 Supply 900 850 diagram depicts the market for these batteries in which these 800 external costs are not internalized. Please adjust the 750 700 appropriate curves to represent the market if the external costs 650 are internalized. 600 550 500 450 400 350 300 250 200 Demand 150 100 50 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 Quantity

Specialized electronic batteries, such as those for laptops, are hard to dispose of safely, yielding excess pollution when one Market for Laptop Batteries gets thrown away. Suppose that producing these batteries creates an external cost of $150 per unit. The accompanying 1,000 950 Supply 900 850 diagram depicts the market for these batteries in which these 800 external costs are not internalized. Please adjust the 750 700 appropriate curves to represent the market if the external costs 650 are internalized. 600 550 500 450 400 350 300 250 200 Demand 150 100 50 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 Quantity

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter12: Environmental Protection And Negative Externalities

Section: Chapter Questions

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?
Consider the case of global environmental problems that spill across international borders as a prisoners dilemma of the sort studied in Monopolistic Competition and Oligopoly. Say that there are two countries, A and B. Each country can cheese whether to protect the environment, at a cost of 10, or not to protect it, at a cost of zero. If one country decides to protect the environment, there is a benefit of 16, but the benefit is divided equally between the two countries. If both countries decide to protect the environment, there is a benefit of 32, which is divided equally between the two centuries. In Table 12.10, fill in the costs, benefits, and total payoffs to the countries of the following decisions. Explain why, without some international agreement, they are likely to end up with neither country acting to protect the environment.
What is a pollution charge and what incentive does it provide for a firm to take external costs into account?
Suppose you want to put a dollar value on the external costs of carbon emissions from a power plant. What information or data would you obtain to measure the external [not social] cost?
Do market demand curves reflect positive externalities? Why or why not?
Economists sometimes shock noneconomists by stating that they do not favor the complete elimination of pollution. Explain the rationale for this position.
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.
Suppose that a firm’s emissions and Marginal Abatement Cost (MAC) data are summarized in thetable below. e MAC 0 200 10 180 20 160 30 140 40 120 50 100 60 80 70 60 80 40 90 20 100 0 a. If the price of a pollution permit is $100, how many permits will the firm need? Explain.b. Suppose that the price of a pollution permit increases to $120, how many permits will thefirm need? Explain.c. With this new price of $120, will the firm’s emissions increase or decrease? By howmuch? Explain.d. Can the firm sell any permits? If so, what is the revenue generated from permit sales?Explain.
Aside from greenhouse gas emissions [e.g., carbon dioxide (CO2)], vehicles emit pollutants such as nitrogen oxides (NOx), which contribute to the formation of ozone and acid rain, and carbon monoxide (CO), the ingestion of which reduces the flow of oxygen in the bloodstream and is particularly dangerous to persons with heart disease. Assume that the following equation describes these marginal external costs: EMC= 0.125Q Inverse Demand Function: MB = 180,000–QdMarginal Cost Function:MC = 0.25 Qs c.What is the social marginal cost function (SMC)? Graph this function along with the private marginal cost (label this PMC) and marginal benefit functions. d.Determine the socially efficient equilibrium price and quantity and denote them by Psocand Qsoc. Show your answer both graphically and mathematically. e.What is total surplus at this social optimum (Ps, Qs)? Calculate totalsurplus numerically as well as indicate the area on the graph that corresponds with totalsurplus.…
Aside from greenhouse gas emissions [e.g., carbon dioxide (CO2)], vehicles emit pollutants such as nitrogen oxides (NOx), which contribute to the formation of ozone and acid rain, and carbon monoxide (CO), the ingestion of which reduces the flow of oxygen in the bloodstream and is particularly dangerous to persons with heart disease. Assume that the following equation describes these marginal external costs: EMC= 0.125Q Inverse Demand Function: MB = 180,000–QdMarginal Cost Function:MC = 0.25 Qs c.What is the social marginal cost function (SMC)? Graph this function along with the private marginal cost (label this PMC) and marginal benefit functions. d.Determine the socially efficient equilibrium price and quantity and denote them by Psocand Qsoc. Show your answer both graphically and mathematically. e.What is total surplus at this social optimum (Ps, Qs)? Calculate totalsurplus numerically as well as indicate the area on the graph that corresponds with totalsurplus.…
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.
The market for plasticans is perfectly competitive. Market Supply is givenby Q=8P and Market Demand is given by Q=417-3P. Each extra unit ofplastican produced imposes a negative externality of $7. What is theefficient quantity? Efficient quantity is determined by setting Marginal Social Costs(=Marg. Pvt. Cost + Marg. External Cost.) equal to Marg. SocialCost=MWTP which is captured by the Demand curve.