Marginal social benefit, Microeconomics

Assignment Help:

Consider the following information relating to the pulp market.

 

Demand

 

 

Supply

 

Output(tonnes/ day)

Marginal private benefit

Marginal social benefit

Output

(tonnes/day)

Marginal private cost

Marginal social cost

1

$140

 

1

$50

 

2

$120

 

2

$60

 

3

$100

 

3

$70

 

4

$80

 

4

$80

 

5

$60

 

5

$90

 

a. If this market considers only marginal private benefit and marginal private cost, how much pulp will be produced and at what price will it be sold?

b. Assume that pulp mills provide no external benefits and that each tonne of pulp generates $30 of external costs. Complete the table by entering the data for the columns headed 'Marginal social benefit' and 'Marginal social cost'.

c. What would be the socially optimal quantity of pulp produced and the socially optimal price at which will it be sold?


Related Discussions:- Marginal social benefit

Output in short run, Selecting Output in Short Run * We will combine pr...

Selecting Output in Short Run * We will combine production and cost analysis with demand to determine output and profitability. A Competitive Firm Making Positive Profit

Economics of scale, give a detailed discussion on the term economics of sca...

give a detailed discussion on the term economics of scale as applied to economics, highting examples,limitation,and original of economics of scale.

Supply, The table shows the demand schedule of Taylor Swift’s concert ticke...

The table shows the demand schedule of Taylor Swift’s concert ticket. Draw the demand curve for her concert ticket

Explain the concept of circular flow of income, Problem 1: i) It has of...

Problem 1: i) It has often been argued that a monopoly has both costs and benefits. Discuss. ii) Explain, using diagram the short and long equilibrium positions of a monopo

Perfect competition, Perfect competition: Perfect completion refers to...

Perfect competition: Perfect completion refers to the market structure in which there are a large number of relatively small firms, each firm having freedom of entry into and

Trade, What are the basis for International Trade?

What are the basis for International Trade?

Write Your Message!

Captcha
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