2) Suppose the demand curve for a rubber-based product is Q_D=225-0.5P, and the supply curve is Q_S=0.5P-15. If the external cost of the suit from the waste produced by the factory producing the item is MEC-Q, calculate: (a) Competitive price and quantity when there is no control over the waste disposal of the factory. (b) Price and quantity at the socially optimal level.

2) Suppose the demand curve for a rubber-based product is Q_D=225-0.5P, and the supply curve is Q_S=0.5P-15. If the external cost of the suit from the waste produced by the factory producing the item is MEC-Q, calculate: (a) Competitive price and quantity when there is no control over the waste disposal of the factory. (b) Price and quantity at the socially optimal level.

Micro Economics For Today

10th Edition

ISBN:9781337613064

Author:Tucker, Irvin B.

Publisher:Tucker, Irvin B.

Chapter14: Environmental Economics

Section: Chapter Questions

Problem 11SQ

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