What is the efficient solution for society

Assignment Help Business Economics
Reference no: EM131091302

Suppose a manufacturing firm dumps its waste into the river, causing pollution downstream where residents like to water ski and fish. The marginal external cost to the residents is $800 for their diminished recreational enjoyment. The marginal benefit to the firm of dumping the waste is $500, the amount of money they save by not having to haul the waste away.

What is the efficient solution for society: for the firms to have the right to dump the waste, or for the residents to have the right to clean water? Tell 2 stories about how the efficient outcome would be negotiated between both parties, regardless of who ultimately is awarded the property rights.

Reference no: EM131091302

Questions Cloud

Discuss stress and how it varies across cultures : Discuss stress and how it varies across cultures. How do legal, cultural, and economic factors influence product policy? Why are brand names an important marketing tool for international business?
New entrant comes late to the bidding process : Suppose that a new entrant comes late to the bidding process, and plans a super competitive bid of $13,900 per case. This is a new orthopedic institute that is made up of several orthopedic surgical groups. They have their own diagnostic facilities a..
What are some of the monetary policies : What are some of the monetary policies put in place during the decade of the 1980s? Consider the discount rate set by the Fed, the rates on reserves, and open market operations. What were the actions and impacts of these policies on businesses and in..
How the free market fails at allocating efficient quantity : A coal fire plant that produces electricity emits sulfer dioxide, which causes Acid Rain, into the atmosphere. The market equilibrium price of electricity is $6 per kilowatt hour (kWh) and the market equilibrium quantity is 10 kWh. What type of exter..
What is the efficient solution for society : Suppose a manufacturing firm dumps its waste into the river, causing pollution downstream where residents like to water ski and fish. The marginal external cost to the residents is $800 for their diminished recreational enjoyment. What is the efficie..
Demand and supply functions of good are specified : Suppose the demand and supply functions of a good are specified as follows: QD= 600-2p and QS= -200 + 3P. Equilibrium price and quantity must be:
The social security statement : Charles Smith is a senior production engineer who has worked for 18 years since he graduated from college. Yesterday in the mail, he received a report from the U.S. Social Security Administration. Charles never thought much about social security; he ..
Explain how changes in price result in upward sloping supply : Explain how changes in prices result in a downwards sloping demand. Explain how changes in prices result in an upward sloping supply. What will happen when consumer demand equals producer supply?
Average variable cost and average fixed-average total cost : Suppose Ralph hires workers at his supermarket at a wage rate of $12/hour. Ralph currently has 10 checkout stands (i.e., capital), each with a rental rate of $10/hour. Derive Ralph's short-run total cost function.  Derive the corresponding equations ..

Reviews

Write a Review

Business Economics Questions & Answers

  Determine the market rate of substitution

Determine the market rate of substitution. (b) In your graph show the budget set. (c) If PX doubles, what happens to the budget constraint. Show this effect in your graph. (d) What is the meaning of the slope of the two budget constraints?

  Using the traditional supply and demand model

In an effort to reduce education expenditures, Delware shuts down two of the five colleges that train nurses. Using the traditional supply and demand model, discuss the effects of the budget cut on three markets: the markets for nurse schooling (tuit..

  Qsuppose a factory can produce a shirt for the equivalent

q.suppose a factory can produce a shirt for the equivalent cost of 2 loaves of bread and a household can produce a

  Trace the evolution of work on the laissez-faire doctrine

trace the evolution of work on the laissez-faire doctrine through two arcs. first those theorists who are trying to

  Describe the difference between correlation and causation

You work for the American Red Cross as a Health Economics consultant in the Boston area. You are told to guess the correlation between snow damage to houses during the winter storms last year and the median price of the house. Describe the difference..

  How does this policy affect national saving

How does this policy affect national saving, domestic investment, net capital outflow, the interest rate, the exchange rate, and the trade balance?

  There is no way to determine what has happened to supply

Camille's Creations and Julia's Jewels both sell beads in a competitive market. If at the market price of $5, both are running out of beads to sell (they can't keep up with the quantity demanded at that price), then we would expect both Camille's and..

  Describe the makeup of food service industry

Describe the makeup of food service industry in canada. What is the size in sales dollar of the food service industry in canada? How had the industry been trending over the last several years? Explain with numbers and cited facts please give the refe..

  Explain the law of demand and the law of supply

Explain the law of demand and the law of supply in healthcare. Distinguish between demand and quantity demanded. What determinants cause a shift in demand? Please include reference(s).

  Mixed-strategy nash equilibrium

Player 1 (the “hider”) and player 2 (the “seeker”) play the following game. There are four boxes with lids, arranged in a straight line. For convenience, the boxes are labeled A, B, C, and D. The administrator of the game gives player 1 a $100 bill, ..

  Q1 explain the essential distinctions among the

q1. explain the essential distinctions among the stages-of-growth theory of development the structural change models of

  ROR analysis of mutually exclusive service projects

When one is conducting an ROR analysis of mutually exclusive service projects

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