Whether limiting waste disposal in manner provides solution

Reference no: EM13201173

Suppose there is currently a single firm in the United States that will accept a particular type of radioactive waste for disposal. The inverse demand function is given by

$P=600-\frac{1}{2000}Q$ ,

where Q represents cubic feet of waste disposed per year. Suppose the cost of waste disposal is

$C(Q)=50+250Q+\frac{3}{2000}Q^2$ .

What is the firm's optimal quantity and price?

Next, suppose that the disposal firm's state passes a law that limits waste disposal to 50,000 cubic feet per year, as a response to the monopolist's deadweight loss. Please calculate the change in the monopolist's deadweight loss and therefore determine whether limiting waste disposal in this manner provides a solution to the deadweight loss problem.

Reference no: EM13201173

Questions Cloud

Explain oppose the reinstatement of a military draft : Is there convincing evidence that the proportion of American adults who oppose reinstatement of the draft is greater than 0.7? Use a significance level of 0.05. (For z give the answer to two decimal places. For P give the answer to four decimal pl..

Exchange rate between the canadian dollar and u.s. dollar : Suppose that the real interest rates are equalized in the two countries and that purchasing-power parity holds. Using the Fisher equation, what can infer about expected inflation in Canada and in the United States

Explain why is it necessary to study the order of operations : Why is it necessary to study the order of operations and the laws of operations before you begin solving equations?

What are the ultimate causes for the current crisis : What are the potential implications of this problem for Euro-Currency and European Monetary Integration. What should Europe do to address this problem now and what are the potential perils?

Whether limiting waste disposal in manner provides solution : suppose that the disposal firm's state passes a law that limits waste disposal to 50,000 cubic feet per year, as a response to the monopolist's deadweight loss. Please calculate the change in the monopolist's deadweight loss.

Challenges due to the increasing use of e-finance : What are the positive aspects of increasing adoption of E-Finance globally and what are the major challenges due to the increasing use of E-Finance?

What is the dominant strategy : Mitchell Electronics produces a home video game that has become very popular with children. If the threat is not credible, what changes in the game would be necessary to make the threat credible.

Calculate roi for each segment : Find the Financial Statements and Supplemental Data and look for one of the notes to the financial statements that provides Segment Information.)

Why the price of dvds is unchanged : Suppose that the current market price of VCRs is $300, that average consumer disposable income is $30,000, and that the price of DVD players (a substitute for VCRs) is $500. Under these conditions annual U.S. demand for VCRs is 5 million per year.

User Account

All Pages