What is the efficient level of production of x

Assignment Help Business Economics
Reference no: EM133126227

The private marginal benefit for commodity X is given by 10 - X, where X is the number of units consumed. The private marginal cost of producing X is given by 4 + x and producing this commodity creates a negative externality, the marginal external cost is constant at $2.

(a) How much X is produced without government intervention and at what price? What are producer and consumer surplus in this case?

(b) What is the efficient level of production of X?

(c) Suggest a Pigouvian tax that would lead to the efficient level of production.

(d) What is the producer surplus in this market with the optimal Pigouvian tax?

(e) If some of the government revenue is spent compensating taxed producers for their lost surplus, how much remains?

Reference no: EM133126227

Questions Cloud

Define small to medium business enterprises : Define "small to medium business enterprises". Outline how Sarah's small business could contribute to the Australian economy
Profit maximizing quantity to produce : Suppose you estimate the short-run total cost function to be TC = 200 + 10Q + 0.1Q2.
What economists mean by the concept of scarcity : Explain what economists mean by the concept of scarcity. In what ways does this impact on your current life?
Find the firm profit maximizing output quantity : (a) Find the firm's profit maximizing output quantity and the resulting amount of environmental damage in the absence of any regulation.
What is the efficient level of production of x : The private marginal benefit for commodity X is given by 10 - X, where X is the number of units consumed. The private marginal cost of producing X is given by 4
Discuss the method is used to measure a firm market risk : Differentiate between systematic and unsystematic risk using a relevant diagram. Discuss the method is used to measure a firm market risk
What would the job offer total : Question - If the Operations Manager wants to bring in an Engineer at 120% of the top salary range of $70,000, what would the job offer total
ACCY936 Management and Information Systems Assignment : ACCY936 Management and Information Systems Assignment Help and Solution, University of Wollongong - Assessment Writing Service
Production possibilities frontier of a small : Table 1 shows the production possibilities frontier of a small Pacific island economy. Use this table to work on these exercises.

Reviews

Write a Review

Business Economics Questions & Answers

  Mortgage loans compound monthly

With their credit history, they can borrow a 30-year fixed rate mortgage loan at 5.4% (mortgage loans compound monthly).

  Holding medic and feduc fixed

Do sibs have the expected effect. Explain. Holding medic and feduc fixed, by how much do sibs have to increase to reduce predicted years of education by one year.

  Determine the critical value of the fixed cost F-bar

An incumbent monopoly with constant marginal cost k operates in a market with demand schedule p = a-Q, where p is the price, Q is the quantity demanded and a > k is a positive parameter. Determine the critical value of the fixed cost F-bar where the ..

  Speaking to an audience of business people

Given that you are a newly hired government agent and you are speaking to an audience of business people, using economics terms, concepts, and or methods

  Cost of pollution control differs widely

Suppose an environmental regulation requires all polluters to reduce emissions by 50%, even though the cost of pollution control differs widely from one polluter to another. Why might this be inefficient, using the definition of efficiency developed ..

  What to produce with limited resources

List the economic benefits of, and problems with, subsidized college education. Examine subsidized college education by considering answers to the three basic economic questions: What to produce with limited resources? How to produce the goods and se..

  What is the book value of the equipment at the end of year

Some seed cleaning equipment was purchased at the end of 2008 for $8,571 and is depreciated by the double declining balance (DDB) method (not MACRS) for an expected life of 8 years. What is the book value of the equipment at the end of year 2,011? Or..

  What is the cost of saving each life

At the time, there were 180 million automobiles and 250 million people in the United States. Each vehicle was driven about 15,000 miles each year. What is the cost of saving each life?

  Which nation should specialize in which product

Which nation should specialize in which product. Explain how trading possibilities lines for each nation if actual terms of trade are 1 plum for 2 apples.

  Qcomplete the international trade simulationlist at least

q.complete the international trade simulation.list at least one benefit also one limitation of international trade you

  Appropriate version of the ws-ps model

Use the appropriate version of the WS-PS model to explain and show why a productivity growth slowdown would be associated with a higher un.

  Increase total revenue price be increased or decreased

If the objective is to increase total revenue, should the price be increased or decreased, Explain.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd