Why is the answer c? Using Figure 2, determine the efficient allocation of a fixed water supply of 22 units of water. MB = 8 b. and MB stand for the marginal net benefits of water for groups A and B, respectively. a. Q = 14;QB = 12; QB = 10 c. = 16;Q = 6d. Q₁ = 18;Q = 4 e. None of the above A B A ure 2 60 60 C vig Water Allocation nigni 50 50 40 40 30 30 20 20 10 10 0 45 50 5 10 15 V20 S25 30 35 40 40 bremenigniVylqque- QuantityЯylqqu -MBA MBB

Q: 45. Consider an exchange economy with two agents, 1 and 2, and two goods, X and Y. There are 6 units…

A: “Since you have posted multiple questions, we will provide the solution only to the first question…

Q: Total Fixed Cost (TFC), Total Variable Cost (TVC), Total Cost (TC), and the Average Total Cost (ATC)…

A: The fixed cost refers to the cost that does not change with change in level of output. On other…

Q: equilibrium market compensation

A: In economic terms, the "equilibrium marketplace compensation" refers to the level of compensation…

Q: The Consumer Price Index (CPI) exhibits four known biases. Three of these biases occur, because the…

A: The consumer price index or CPI is a more direct method than per capita GDP of the standard of…

Q: A firm uses the Cobb-Douglas production technology q=xx, where a and Ba constants. (a) Derive the…

A: Economists Charles Cobb and Paul Douglas introduced the Cobb-Douglas production function in the…

Q: Suppose most economists agree that the target rate of unemployment is between 5 and 8 percent. If…

A: The target rate of unemployment means the lowest possible level of unemployment desired in the…

Q: Determine whether the statement is TRUE or FALSE. Support your answer based on the concepts of money…

A: The currency deposit ratio denotes the percentage of bank deposits maintained as physical currency…

Q: 0 1 2 3 4 5 6 7 8 9 Quantity of output Refer to Figure 2. At the profit-maximizing quantity, the…

A: There are numerous buyers and sellers.Services and goods sold in this market are identical or…

Q: A popular social media celebrity has recently touted the benefits of taking a hotel mini break in…

A: The problem involves two opposing effects on the price of hotel stays in Australia:The problem…

Q: Complete the following table by using the previous graphs to determine the values of consumer and…

A: Tax is the sum of money that the government of a country collects from its households and firms for…

Q: Is the equilibrium at full employment, inflation or recession? Price level Aggregate Demand…

A: The objective of the question is to determine the state of the economy - whether it is in a state of…

Q: Total revenue, total cost, and profit. Oscar runs a lemonade stand. He sells each cup of lemonade…

A: GIVEN:Price of each cup of lemonade Variable cost per cup Fixed cost Total cups soldPROBLEM:Find the…

Q: 15. Given the data provided in the table below, what will the marginal revenue equal for production…

A: Marginal Revenue (MR) is the additional revenue that is gained from selling one more unit of a…

Q: Q3. Which answer below best describes the essence of the Philipps' Curve relationship? As labour…

A: The objective of the question is to identify the correct description of the Phillips Curve…

Q: If the AD shortfall is $700 billion and the MPC is 0.95,(a) How large is the desired fiscal…

A: It refers to government actions aimed at increasing economic activity through increased spending or…

Q: 1. From the table below, gross domestic product equals: a. $1,110 b. $1,265 c. $1,470 d. $1,695…

A: It calculates the total worth of all services and goods generated inside the boundaries of a nation.…

Q: 2.80- 2.60 a 2.40- Supply 2.20 G 으 200 billion Consider the market for ethanol in the United States…

A: The consumer pays less amount for a given situation to achieve a financial benefit. The lower the…

Q: This is similar to Section 3.9 Problem 2: The elasticity of a good is E = 0.8. (a) A 2% price…

A: The elasticity of demand(E) for the given good is 0.8. This indicates an inelastic demand(DD) as the…

Q: The money demand curve will shift to the left when which of the following occurs?an increase in…

A: Here we have analyse the reason behind the left shift of money demand curve.The link between the…

Q: Question 17 A rise in government spending on large infrastructure projects, such as a new high speed…

A: Government spending refers to the aggregate sum of money that a government distributes and uses to…

Q: If the price in a competitive market is "lower than equilibrium” then a. quantity demanded exceeds…

A: Competitive market refers to a market in which there are a huge number if buyers and sellers which…

Q: QUESTION ONE "Fluctuations in employment over the business cycle bring fluctuations in real gross…

A: Aggregate supply in the economy is identified as the total amount of goods and services that…

Q: The figure below shows the national market for mopeds in a small country. Dd and Sd are the domestic…

A: A tariff is a tax or duty imposed by a government on imported or exported goods. The purpose of a…

Q: Table 6-4 The following table contains the demand schedule and supply schedule for a market for a…

A: The price, quantity demanded and supplied is provided below.PriceQuantity demandedQuantity…

Q: Refer to the figure above. When the demand curve is given by P2 = $15, this firm should ______ A.…

A: The correct answer is B. discontinue operation in the short run since there is a loss when…

Q: Hannah and Sam run Moretown Makeovers, a home remodeling business. The number of square feet they…

A: The production function of the Cobb-Douglas form is given as The production function for Hannah and…

Q: A firm can produce output using two inputs: capital (K) and labor (L). The level of production that…

A: Given,The production function:And

Q: Each extra worker produces an additional unit of output up to six workers. As more workers are…

A: MP curve is essential for figuring out the best way to use resources and set prices The APcurve…

Q: where consumption for the type i agent in period j is denoted c. The type 2 agent faces budget…

A: In economics, an inter temporal budget constraint is an idea that symbolizes the equilibrium between…

Q: 6. In the two-sector model of an economy (described under the heading "Misallocation of Factors…

A: The labor demand curve represents the quantity of labor demanded at different wage rates.The labor…

Q: Required information Assume you started a sideline business in commercial photography last year…

A: The payback period is the amount of time it takes to recover the cost of investment or the length of…

Q: What factors can lead to an increase in a country's Gross Domestic Product (GDP)?

A: GDP (Gross domestic product) gauges the complete worth of all labor and products delivered…

Q: Coku-cola and Pepusi are two duopoly cola brands in the coke market. A market research had been…

A: A duopoly refers to a market in which two enterprises have significant control over pricing, output,…

Q: What is the present value of $8000 paid at the end of each of the next 16 years if the interest nate…

A: The present value of the annuity is the current value of the future payments from an annuity. The…

Q: 1. The table below shows the hourly output and cost structure for a small-town pizza shop. Calculate…

A: The market price(P) of a pizza is $10. The hourly output(Q) and the total hourly cost structure(TC)…

Q: Why does having a dual mandate complicate policy making at a central bank like the FED? Why do some…

A: Modern Monetary Policy: Modern monetary policy refers to the contemporary approaches, tools, and…

Q: 6. Suppose nominal GDP decreased by 1.5%. Over that year, the GDP deflator increased by 1.0%. From…

A: Real GDP is the macroeconomic indicator of the total economic output. The overall output is adjusted…

Q: 1. In Figure 7.1, panel (c) shows the case where Country 1 has higher output than Country 2 because…

A: Production function signifies the technical correlation between inputs and output associated with…

Q: Price per Slice DEMAND AND SUPPLY FOR A SLICE OF ROY'S FAMOUS PIZZA Number of Roy's Famous slices…

A: Demand in the market represents the consumers' willingness to pay for the goods and services in the…

Q: There are two countries, X and Z. Productivity in Country X is twice as high as productiv- ity in…

A: Productivity and technology are two key factors that determine a country's efficiency in producing…

Q: Fiona has a monopoly on motorboat rentals on Nantucket Island during the summer. She can rent five…

A: The Total Revenue is the revenue that is earned by selling all the goods and services by the firm.On…

Q: Candak Corporation produces professional quality digital cameras.         The market for…

A: A. Candak Corporation will choose to produce and sell 10,000 units at a price of $3,000 each.B. This…

Q: 2. Consider the same game poker, except that the deck now has aces, kings, and queens. The new…

A: Game theory is a powerful tool that economists use to analyze the strategic interactions of rational…

Q: What are the effects of a country's currency depreciation on its import and export activities?

A: Money deterioration is the point at which the worth of a country's cash falls compared to different…

Q: Consider the national market for in-home child care in the accompanying graph. Rate ($ per hour) $20…

A: Marginal cost refers to the additional cost incurred by producing one more unit of a good or…

Q: Marginal cost is given by 20+ 10Q 12Q2. Fixed cost is 100. What is the average cost? OA. 100…

A: Average costs hold significance in firm theory by revealing efficiency levels, guiding production…

Q: Question 13 A firm suffers from diseconomies of scale when it increases output. Which one of the…

A: Diseconomies of scale refers to what is happening in economics when a business expands its…

Q: a) Explain how unemployment (u) and expected price level (P^e) affect nominal wages and expected…

A: The concept wherein an employee working in an area with high unemployment often earns significantly…

Q: Calculate the value of the money multiplier in each of the following situations: Banks hold no…

A: Required reserves and money multiplier:The required reserve ratio of a bank depicts the minimum…

Q: Suppose that there are only two polluters in a society. If left uncontrolled, polluter 1 emits 85…

A: Given,

Market Failure Analysis

To understand Market failure, we need to first understand welfare economics. An Italian economist, Vilfredo Pareto stated that allocation of resources in an efficient manner such that an economic change, which harms no one and makes someone better off, indicates an increase in social welfare. It is also called Pareto Optimality, where resources cannot further be reallocated without harming one. This does not apply to those economic changes, which harm some and benefit others. social welfare increases if the utility of any of its members' increases and none decrease in the economy.