Calculate the new equilibrium price and quantity

Assignment Help Microeconomics

Reference no: EM133442290

Question: The market for a particular chemical, called Negext is described by the following equations:

Qd = 100 -5P

Qs =5P

Find the equilibrium price and quantity. Compute consumer surplus and producer surplus at the market equilibrium.
For each unit of Negext produced, 5 units of pollution are emitted, and each unit of pollution imposes a cost on society of $1. Compute the total cost of pollution when the market is in equilibrium
Suppose that the government restricts emissions to 100 units of pollution. Graph the market under this constraint. Find the new price and quantity and show them on your graph.
Suppose that instead of restricting pollution, the government imposes a tax on producers equal to $5 for each unit of a chemical produced. Calculate the new equilibrium price and quantity and the cost of pollution.
Which of the two policies would you recommend? Why?

Reference no: EM133442290

Questions Cloud

Are any groups disproportionately affected in terms : Health Inequities (Who is affected with a focus on inequities and marginalized groups in terms of incidence, treatment, outcomes, etc.?

What level of capacity would it choose : Suppose that instead of increasing its capacity to 8 units, firm 1 can lower its capacity, so that it can produce no more than 4 units. Should it do so

Provide support for an individual with a particular disorder : imagine that you were tasked to provide support for an individual with a particular disorder. Present research findings on this specific disorder

Different physical activities that you engaged in this : different physical activities (PA) that you engaged in this past week. Describe each PA then explain what sphere(s) it could be included in and why.

Calculate the new equilibrium price and quantity : Suppose that instead of restricting pollution, the government imposes a tax on producers equal to $5 for each unit of a chemical produced

What actions can you take to protect his network attacks : Despite him knowing a lot of technical things, he needs your help to implement defenses against a detected rogue access point and an evil twin.

Why might a profitable motel go out of business : Why might a profitable motel go out of business in the long run if the land on which it is located becomes extremely valuable due to rapid economic growth

Describe the approach a phenomenological researcher : Briefly describe the approach a phenomenological researcher might take when researching this topic and state a suitable research question for a phenomenological

What subscription fee and usage price would you charge : What subscription fee and usage price would you charge for business customers? What would be your profits from a typical business customer

User Account

All Pages