Suppose in the market for gasoline the demand is given by P = 8000 – Qd and the supply is given by P = 2000 + Qs. There is a negative production externality of x = -500. What is the social marginal cost curve
Suppose in the market for gasoline the demand is given by P = 8000 – Qd and the supply is given by P = 2000 + Qs. There is a negative production externality of x = -500. What is the social marginal cost curve
Chapter17: Market Failure: Externalities, Public Goods, And Asymmetric Information
Section: Chapter Questions
Problem 2QP
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Suppose in the market for gasoline the demand is given by P = 8000 – Qd and the supply is given by P = 2000 + Qs. There is a negative production externality of x = -500. What is the social marginal cost curve?
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