Question
In: Economics
Assume the marginal cost of pollution is given by MC=Q, where Q denotes the quantity of...
Assume the marginal cost of pollution is given by MC=Q, where Q denotes the quantity of pollution measured in % on a scale from 0 to 100. The marginal cost of reduction (MCR) is given by MCR=1. Refer to the Coase Theorem and calculate the optimal quantity of pollution AND the welfare gain that results from trade (compared to a pollution of zero or of 100, resp.) when
-
there is an exclusive property right to clean air and
-
there is an exclusive property right to polluting the air.
(note that Q ranges from zero to 100)
Solutions
Rahul Sunny answered 1 year agoRelated Solutions
Assume the marginal cost of pollution is given by MC=Q, where Q denotes the quantity of...
Assume the marginal cost of pollution is given by MC=Q, where Q
denotes the quantity of pollution measured in % on a scale from 0
to 100. The marginal cost of reduction (MCR) is given by MCR=1.
Refer to the Coase Theorem and calculate the optimal quantity of
pollution AND the welfare gain that results from trade (compared to
a pollution of zero or of 100, resp.) when
there is an exclusive property right to clean air and
there is...
What is the marginal revenue (MR) and marginal cost (MC) as a function of Q? At what quantity is
The Company X has a monopoly on the beer market. Market
demand is given by ?? = 200 - 4? and the company's short-term cost
as a function of ? is given by ? (?) = ?2 + 40What is the marginal revenue (MR) and marginal cost (MC) as a
function of Q? At what quantity is ?? = ???
Suppose that a competitive firm's marginal cost of producing output q is given by MC(q) =...
Suppose that a competitive firm's marginal cost of producing
output q is given by MC(q) = 3+2q. Assume that the market price of
the firm's product is $9.
(a) What level of output will the firm produce?
(b) Suppose that the average variable cost of this firm is given
by AV C(q) = 3 + q. Suppose that the firm's fixed costs are known
to be $3. Will the firm be earning a positive, negative, or zero
profit in the...
Table of Q Output, TC, MC, Qd, P and MR Output Total cost Marginal cost Quantity...
Table of Q Output, TC, MC, Qd, P and MR
Output
Total cost
Marginal cost
Quantity demanded
Price
Marginal revenue
0
$75
0
$180
1
120
$_____
1
165
$_____
2
135
_____
2
150
_____
3
165
_____
3
135
_____
4
210
_____
4
120
_____
5
270
_____
5
105
_____
6
345
_____
6
90
_____
7
435
_____
7
75
_____
8
540
_____
8
60
_____
9
660
_____
9
45
_____
10
795...
1. Suppose that a competitive firm’s marginal cost function is given by MC(q) = 4 +...
1. Suppose that a competitive firm’s marginal cost function is
given by MC(q) = 4 + aq, where a > 0 and the market price is
16.
a) What is the firm’s profit-maximizing level of output when a =
4?
b) Suppose the firm’s fixed costs increase and the value of a
decreases. How will this affect the firm’s profit-maximizing level
of output?
c) Suppose the firm’s producer surplus at its profit-maximizing
level of output is 36. What is the...
Marginal costs of production are given by the following function: MC(Q) = 4 − Q Q...
Marginal costs of production are given by the following
function: MC(Q) = 4 − Q Q ≤ 2 ,2Q − 2 Q > 2 (a) Plot the
marginal cost curve. (b) Give the expressions for V C(Q) and AV
C(Q). (c) Plot AV C(Q) on the plot from (a). (d) Give the
expression for the supply curve of this firm. (e) Is it possible to
find a different MC(Q) function that gives rise to the same supply
curve? If yes,...
A monopolist with marginal cost of MC=Q faces a demand curve of QD = 20 -...
A monopolist with marginal cost of MC=Q faces a demand curve of
QD = 20 - 2P. This implies that P = 10 - (1/2)Q and that the
marginal revenue is MR = 10 - Q. a. Sketch demand, marginal
revenue, and marginal cost curves. b. What quantity and price will
the monopolist set? c. What quantity and price would the monopolist
set if it produced at the efficient market outcome where P=MC? d.
Identify the CS, PS and DWL...
he marginal cost (MC)
a. The marginal cost (MC) is the change in the TC for a unit change in output; that is, it is the rate of change of the TC with respect to output. (Technically, it is the derivative of the TC with respect to X, the output.) Derive this function from regression (5.32).b. The average variable cost (AVC) is the total variable cost (TVC) divided by the total output. Derive the AVC function from regression (5.32).c. The average cost (AC) of...
he marginal cost (MC)
a. The marginal cost (MC) is the change in the TC for a unit change in output; that is, it is the rate of change of the TC with respect to output. (Technically, it is the derivative of the TC with respect to X, the output.) Derive this function from regression (5.32).b. The average variable cost (AVC) is the total variable cost (TVC) divided by the total output. Derive the AVC function from regression (5.32).c. The average cost (AC) of...
Consider a monopolist with a total cost of TC=9+Q and marginal cost of $1 (MC=1). The...
Consider a monopolist with a total cost of TC=9+Q and marginal
cost of $1 (MC=1). The monopolist faces a demand curve of
P=11-Q.
1. Graph the monopolist
2. Find price and quantity that the monopolist charges.
3. Find the profit and consumer surplus.
4. Find the deadweight loss to welfare.
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