Top Posters
Since Sunday
5
a
5
k
5
c
5
B
5
l
5
C
4
s
4
a
4
t
4
i
4
r
4
Home Q & A Board Other Fields Homework Help Business Economics
New Topic  
deroth deroth
wrote...
Go to Answer
Posts: 121
Rep: 0 0
A year ago

The diagram below shows the marginal benefit of consuming, and marginal cost of providing, a public good. This economy has 3 individuals, A, B and C. The diagram shows the MB for each individual and a summation of their marginal benefits.

Short description: A graph plots quantity against marginal benefit, marginal cost. Long description: The horizontal axis representing quantity ranges from Q subscript 1 to Q subscript 4. The vertical axis represents a marginal benefit, marginal cost ranges from P subscript 1 to P subscript 4. The graph plots four lines. A line representing MC passes through the following points: (Q subscript 1, P subscript 1), (Q subscript 2, P subscript 2), (Q subscript 3, P subscript 3), and (Q subscript 4, P subscript 4). Three parallel lines, MB subscript A, MB subscript B, and MB subscript C intersect the line, MC at points, (Q subscript 1, P subscript 1), (Q subscript 2, P subscript 2), and (Q subscript 3, P subscript 3). The line representing M B subscript A B C intersects the line, MC at point (Q subscript 4, P subscript 4).

FIGURE 16-4

Refer to Figure 16-4. Suppose the government provides Q4 units of the public good. If the government was able to require consumers to pay a price of P4, then



▸ the appropriate price would be achieved, although not enough would be consumed.

▸ the inefficient quantity would be being produced.

▸ consumers would use too little of the public good, and this would be inefficient for society.

▸ consumers would not use the public good at all, and this would be socially optimal.

▸ the market would clear, although not enough would be produced.
Textbook 
Microeconomics

Microeconomics


Edition: 17th
Author:
Read 42 times
1 Reply
Replies
Answer verified by a subject expert
livewelldreambilivewelldreambi
wrote...
#1
Posts: 144
Rep: 1 0
A year ago
Sign in or Sign up in seconds to unlock everything for free
More solutions for this book are available here
1

Related Topics

deroth Author
wrote...

A year ago
Correct Slight Smile TY
smi3
wrote...

Yesterday
Just got PERFECT on my quiz
Shuqin
wrote...

2 hours ago
Smart ... Thanks!
New Topic      
Quick Reply
Explore
Post your homework questions and get free online help from our incredible volunteers
  1394 People Browsing
Start New Topic Take the Tour CoursesNew Study Tools Topics Trending Browse by Textbook
Live Chat
Related Images
  
 1660
  
 4429
  
 306
Your Opinion
Where do you get your textbooks?
Votes: 372
Previous poll results: Which industry do you think artificial intelligence (AI) will impact the most?