Price Sapply 125 Social value Demand 53 73 94 Quanhity 13. Refer to the figure.

Question

Price Sapply 125 Social value Demand 53 73 94 Quanhity 13. Refer to the figure. Noe than the lines labeled "Demand and Social Valueare parallel Also, the slopes of the lnes on the graph refloct the following facts(1) Privatc valuc and social value decrease by $1.00 with each additional unit of the good that is consumed, and 2 peivate cost increases by $1.40 with each additional n of the good that is prodacod. Thus, when the 5%h, unit of the good is prodced and consumed, socid wellbeing increases by a. $2800 b. $31.40 d. $3600. 14. When the 74eh unit of the good is produced and consumed, social well-being a. decreases by $2.40 b. decreases by $1.60 e. increases by $1.00 d. increases by $1.40 15. The socilly optimal quaniy of ouput is a. 58 unit b. 73 units. c. berween 73 and 94 unirs d.94 units. 16. How many unirs of the good are prodaced in a marker eqailibrium a. fewer than 58 b. 58 c. 73 d. 94 17· The social optimum can be teached if

Explanation / Answer

13) Increase in social well being is = ($125-89)- $1.00-$1.40

= $36-$1.00-$1.40

= $36- $2.40 = $ 33.60

So (C)$33.60 is the right answer.

14) When the 74th units of the good is produced and consumed, social well being

Ans:- a) decrease by $2.40

15) The Social Optimal Quantity of Output is

Ans:- b) 73 units because in this point the social value and social cost intersect each other.

16) How many units of the good are produced in a market equilibrium?

Ans:- b) 58 is the equilibrium point where the demand and supply intersect each other.

Related Questions

Navigate

• Browse (All)
• Browse P
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.