What would be the marginal user cost in each period

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Assume the same demand conditions as stated in Problem 1, but let the discount rate be 0.10 and the MEC be $4.

(a) How much would be produced in each period in an efficient allocation?

(b) What would be the marginal user cost in each period?

(c) Would the static and dynamic efficiency criteria yield the same answers for this problem? Why?

Reference no: EM131162229

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