Using the following graph, an increase in output from 120 units to 160 units would $24 $22 $20 $18 $16 Price $14- $12- $10- $8 $6 $4 $2- Supply (private cost and external cost) 20 40 60 80 100 120 140 160 180 200 be an action of which a benevolent social planner would approve. increase total economic well-being. increase the external cost per unit of output. O move the market from a socially efficient outcome to a socially inefficient outcome. -Supply (private cost) Demand (private value) -Quantity

Using the following graph, an increase in output from 120 units to 160 units would $24 $22 $20 $18 $16 Price $14- $12- $10- $8 $6 $4 $2- Supply (private cost and external cost) 20 40 60 80 100 120 140 160 180 200 be an action of which a benevolent social planner would approve. increase total economic well-being. increase the external cost per unit of output. O move the market from a socially efficient outcome to a socially inefficient outcome. -Supply (private cost) Demand (private value) -Quantity

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter12: Environmental Protection And Negative Externalities

Section: Chapter Questions

Problem 41P: Refer to Table 12.2. The externality created by the refrigerator production was 100. However, once...

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A country called Sherwood is very heavily covered with a forest of 50,000 trees. There are proposals to clear some of Sherwoods forest and grow com, but obtaining this additional economic output will have an environmental cost from reducing the number of trees. Table 12.11 shows possible combinations of economic output and environmental protection. Sketch a graph of a production possibility frontier with environmental quality on the horizontal axis, measured by the number of trees, and the quantity of economic output, measured in corn, on the vertical axis. Which choices display productive efficiency? How can you tell? Which choices show allocative efficiency? How can you tell? In the choice between T and R, decide which one is better. Why? In the choice between T and S, can you say which one is better, and why? If you had to guess, which choice would you think is more likely to represent a command-and-control environmental policy and which choice is more likely to represent a market-oriented environmental policy, choice Q or S? Why?
Suppose a city releases 16 million gallons of raw sewage into a nearby lake. Table 12.8 shows the total costs of cleaning up the sewage to different levels, together with the total benefits of doing so. (Benefits include environmental, recreational, health, and industrial benefits.) Using the information in Table 12.8, calculate the marginal costs and marginal benefits of reducing sewage emissions for this city. See Production, Costs and Industry Structure if you need a refresher on how to calculate marginal costs. What is the optimal level of sewage for this city? Why not just pass a law that films can emit zero sewage? After all, the total benefits of zero emissions exceed the total costs.
Refer to Table 12.2. The externality created by the refrigerator production was 100. However, once we accounted for both the private and additional external costs, the market price increased by only 50. If the external costs were 100 why did the price only increase by 50 when we accounted for all costs?
The chapter defines private enterprise as a characteristic of market-oriented economies. What would public enterprise be? Hint: It is a characteristic of command economies.
Econ Return to Activity Score Mentor Mega Beans Market Booming Berries Booming Berries Materials Mark, if the external marginal cost from Booming Berries is $20 per thousand pounds, what is the socially efficient price per pound? 130 Booming Berrles 120 Clare 110 100 $70 90 80 70 Mark 60 That is correct! 50 40 30 Econ 20 Mentor 10 Mark, if the external marginal cost from Booming Berries is $20 per thousand pounds, what is the socially efficient quantity (in thousands)? 10 20 30 40 50 60 70 80 90 100 110 120 Quantity (in thousands) Clare Enter a response then click Submit below (in thousands) Submit MacBook Air F12 FI1 F9 F10 F8 F7 F6 888 F4 F5 F3 F2 esc F1 * & 24 % 8 @ # 7 3 4 2 T E Q tab Price (per pound)
Use the purple points (diamond symbol) to plot the social cost curve when the external cost is $245 per ton. PRICE (Dollars per ton of bolts) 700 630 560 490 420 350 280 210 140 70 0 0 C ☐ L 1 U D 0 U 2 0 DO O 3 4 5 QUANTITY (Tons of bolts) ☐ Supply (Private Cost) O Demand (Private Value) 7 Social Cost (?) The market equilibrium quantity is 4.5 ▼ tons of bolts, but the socially optimal quantity of bolt production is 3 To create an incentive for the firm to produce the socially optimal quantity of bolts, the government could impose a of bolts. ▼tons. of $ per ton
Does the following activity or event create an extemality? If it does, is it an external benefit or external cost and does it arise from production or consumption? An increase in the number of people who are studying for graduate degrees creates A person who wears strong perfume to class creates, Airplanes taking off from LaGuardia Airport during the US. Open tennis tournament nearby create A sunset over the Pacific Ocean creates OA. an external cost arising from production; no externality B. an external benefit arising from consumption; an external benefit arising from consumption OC. an external cost arising from consumption; no externality D. an external benefit arising from production; an external benefit arising from consumption OA. an external benefit arising from production; an external cost arising from production оооо B. an external cost arising from consumption; an external benefit arising from consumption OC. an external cost arising from production; an external benefit…
Consider the decision to adopt a dog. Describe aprivate cost, a private benefit, an external cost, andan external benefit that result from your decisionto adopt a dog.
0.90 0.85 0.80 0.75 0.70 0.65 0.60 0.55 0.50 0.45 0.40 50 100 150 200 250 300 What kind of externality is in the market above? O a. negative production externality O b. positive consumption externality O c. negative consumption externality O d. positive production externality Demand 350 Supply MSB 400
QUESTION 28 You are unable to sleep because your hotel room is right underneath the noisy air conditioning system. We would classify this situation as an O internal cost. O internal benefit. O external cost. O external benefit.
This graph represents the tobacco industry. IPrice 16 14 Social Cost 12 10 Private Cost 8 6 4 Demand 200 500 650 Quantity a) Without any government intervention, what is the market determined price and quantity? b) What is the price of the externality? c) What is the socially optimal price and quantity? d) What should the government do (impose a tax or provide a subsidy) to internalize this externality? What is the amount of the the corrective tax/subsidy needed to be to move the outcome from the market equilibrium to the socially-optimal outcome?
ASAP plz Why don't people/stores make different decisions? Cost is a factor: a case of foam take-out containers costs $25, compared with $58 for paper and recyclable-plastics. How does this affect the firm's profit? Are consumers willing to pay more? Negative externality Consider the demand and supply given above. Suppose there is an external cost given by MEC=5Q. Find social equilibrium price and quantity. Draw a graph and label both private and social equilibrium.