Microeconomics (2nd Edition) (Pearson Series in Economics)
2nd Edition
ISBN: 9780134492049
Author: Daron Acemoglu, David Laibson, John List
Publisher: PEARSON
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Question
Chapter 9, Problem 11P
(a)
To determine
The marginal social benefit when the temperature is
(b)
To determine
The limit of temperature to which it can be increased.
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Suppose that there are three beachfront parcels of land available for sale in Astoria, and six people who would each like to purchase one parcel. Assume that the parcels are essentially identical and that the selling price of each is $745,000. The following table states each person's willingness and ability to purchase a parcel.
Β
Willingness and Ability to Purchase
(Dollars)
Alyssa
720,000
Brian
690,000
Crystal
680,000
Nick
900,000
Rosa
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Tim
770,000
Β
Which of these people will buy one of the three beachfront parcels?Β Check all that apply.
Alyssa
Β
Brian
Β
Crystal
Β
Nick
Β
Rosa
Β
Tim
Β
Β
Assume that the three beachfront parcels are sold to the people you indicated in the previous section. Suppose that a few days after the last of those beachfront parcels is sold, another essentially identical beachfront parcel becomes available for sale at a price of $732,500. This fourth parcel Β Β _____________be soldβ¦
Lane and Riley are the only two residents in a neighborhood, and they share the same driveway. They would like to have the driveway paved. The value of the paved driveway is $1,500 to Lane and $900 to Riley. Regardless of who pays for the paving both people will benefit from it.
If the cost of paving the driveway is $2,000 and Lane proposes that they each pay 50 percent of this cost, then Riley ______ agree to Laneβs proposal because ______.
Β
A. will; repaving the driveway would increase total economic surplus
B. will not; repaving the driveway would lower total economic surplus
C. will; if they split the cost, then Rileyβs economic surplus would increase
D. will not; if they split the cost, then Rileyβs economic surplus would decrease
There are two people: Brandon, who is really, really good at cleaning front yards and mowing lawns; and Jim, who doesnβt have front yards or lawns in his current time and is worse than Brandon at both. In the course of a weekend, Brandon can clean ten front yards or mow five lawns. Jim, on the other hand, can clean only one front yard or mow only two lawns. Calculate the opportunity cost.
Chapter 9 Solutions
Microeconomics (2nd Edition) (Pearson Series in Economics)
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