The University is considering the level of light to provide at night on campus. Cynthia and Shirley are the only students who work on campus at night. Cynthia's marginal benefit for light is given by MB40-4Q where Q is the brightness of light; while Shirley's marginal benefit is MB -20-20 If there are no fixed costs, and the marginal cost of providing light is given by MC-12, then what is the optimal brightness of light for the university to provide? 10 07 4 None of the above

The University is considering the level of light to provide at night on campus. Cynthia and Shirley are the only students who work on campus at night. Cynthia's marginal benefit for light is given by MB40-4Q where Q is the brightness of light; while Shirley's marginal benefit is MB -20-20 If there are no fixed costs, and the marginal cost of providing light is given by MC-12, then what is the optimal brightness of light for the university to provide? 10 07 4 None of the above

Economics For Today

10th Edition

ISBN:9781337613040

Author:Tucker

Publisher:Tucker

Chapter14: Environmental Economics

Section: Chapter Questions

Problem 7SQ

See similar textbooks

Similar questions

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.
assume that there are 1000 residents of a town, each of whose marginal benefit (willingness to pay) for having x miles of roads is P = 100 - 5x. Roads are built competitively at a marginal cost of MC = 2000 per mile. Roads are a public good. What is the efficient level of roadway construction? It is closest to? If residents decide on road building independently, how many miles of roadway will be built? It is closest to:
Consider 3 individuals in a small town: Alice, Bianca, and Claire. There is an NGO who can provide an art museum for their town with the help of local contributions. The higher the contributions, the larger the art collection of the museum. Their respective direct marginal benefits from N works of art are: MBA=7-N, MBB=7-½N, MBC=23-½N2, and their respective marginal costs are: MCA=2, MCB=3, MBC=5. Find each person’s optimal number of art works. Who will contribute and how many works of art will be provided?
Problem 19-13 There is a road between the suburbs and downtown. The road becomes congested at rush hour. As long as fewer than 100 people use the road at rush hour, the trip takes 30 minutes. When the 101st person enters the road, everyone has to slow down and the trip now takes 31 minutes. People value their time at $6 per hour (i.e., $0.10 per minute) and so a 30 minute trip costs $3. Instructions: Round your answers to two decimal places. a. The private cost of one of the 100 individuals using the road is $ . The total private cost of 100 people using the road is $ . The total social cost of 100 people using the road is $ . b. The total social cost of 101 people using the road is $ . The private cost of using the road for the 101st individual is $ . The external social cost of the 101st person using the road is $ .
Suppose there are 2 petrochemical companies that cause water pollution in the surrounding environment with marginal costs MC1 = 150e1 and MC2 = 50e2 (where e1 and e2 are the amount of waste in m3 reduced by company 1 and company 2). Initially, company 1 disposed of 50 m3 of waste and company 2 disposed of 40 m3 of waste. a. If the government wants to ensure the total waste is reduced by 20 m3 with a cost-effective approach, how much waste must each company reduce?
Why do largest firms, who are also some of the largest polluters, have the resources to invest in more ‘eco’ technologies but often choose not to in favour of maintaining/increasing profit margins
Please help with the calculations & working :) In this question there is a diagram with ‘y’ being the vertical axis representing costs/damages, and ‘P’ being a horizontal axis representing pollution. Abatement is the opposite of pollution, so if pollution falls from, say, 3 to 1 abatement rises by 2. 1. Suppose the marginal damage curve to private firms is MDP: y=0 and the marginal cost of abatement is MCA: y=1-P if P<1 and y=0 otherwise, where y is the vertical axis on a cost/damage scale, and P is the amount of pollution. Plot these curves and the equilibrium amount of pollution which is privately optimal for the firm. 2. Why is the marginal cost of abatement is downward sloping (with increasing pollution measured on the bottom axis as you go right). Give an example where this is a reasonable assumption 3. Suppose the marginal damage to society is MDS: y=P. Calculate the socially optimal amount of pollution. What ethical system does the ‘optimal amount of pollution’ belong? To…
A company near a large city is required to keep its smokestack pollution to new lower levels, costing the company $2 million in additional equipment (which will last at least 10 years) and $100,000 a year in additional labor. Lowering the air pollutants in the region is expected to save $4 million in medical expenses in the affected region over the next 10 years. What level of pollution reduction gives the smallest benefit for money spent? Select one: a. From 1-20% of pollution reduction b. From a 20-40% pollution reduction c. From a 80-100% pollution reduction d. From a 60-80% pollution reduction
It is discovered that production of painclear damages groundwater quality – this affects just one party: Greenview Nature Park (a park run by the local council which people can access, for free, for recreation). The value of the damage caused is £48 per litre of paint produced – so the pollution damage caused when output is 1 litre=£48, the 2 nd litre causes another £48 of damage, so pollution damage caused when output is 2 litres=£96. This damage happens and is the same whenever XY produces, whatever the level of output (same if it produces 1 litre of or 1 000 000 litres of painclear - each additional litre imposes an additional £48 of pollution costs). The drug has no side effects on consumers. (the clarifying information in red was added on 21/12/23) 1.Create and explain a new diagram which shows relevant costs, price and levels of output if XY produced the optimal quantity of painclear from a societal perspective. 2. Assume XY and Greenview can negotiate. Create and explain 2 new…
Suppose the LNG Inc. company wants to build three pipelines that would carry fuels under your city. The pipelines pose risks of groundwater contamination and explosion. For each pipeline the table below shows the marginal benefit to LNG Inc. and the marginal cost of expected damages to residents (in millions of dollars). Pipelines Total Profits for LNG Inc. Total Damage to Residents Marginal Benefit (added profits) Marginal Cost (added damages) 0 0 0 0 0 1 120 55 120 55 2 200 130 80 75 3 270 255 70 125 Suppose that LNG Inc. is entitled under the injunctive remedy. The range of offers (in millions of dollars) that the residents mights make and LNG Inc. might accept to eliminate the third pipeline is between (minimally) ______ and (maximally) _________. Please fill the blanks.
The government of a subtropical country is evaluating the costs and benefits of protecting a rainforest versus cutting it down for timber. The estimated value of the wood is $270$⁢270 million. If the same forest is used as a national park, it may attract 0.030.03 million additional tourists per year. Statistically, each tourist spends $1,600$⁢1,600 inside the country during their stay.How long will it take tourism to exceed the estimated value of the wood in the rainforest? Enter your answer in the box below and round to two decimal places if necessary.
Consider a used car market with asymmetric information. The owners of used cars know what their vehicles are worth but have no way of credibly demonstrating those values to potential buyers. Thus, potential buyers must always worry that the used car they are being offered may be a low quality “lemon.” a. Suppose that there are equal numbers of good and bad used cars in the market and that good used cars are worth $13,000 while bad used cars are worth $5,000. What is the average value of a used car? b. By how much does the average value exceed the value of a bad used car? By how much does the value of a good used car exceed the average value? c. Would a potential seller of a good used car be willing to accept the average value as payment for her vehicle? d. If a buyer negotiates with a seller to purchase the seller’s used car for a price equal to the average value, is the car more likely to be good or bad? e. Will the used-car market come to feature mostly—if not exclusively—lemons? How…