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In: Economics

Suppose that demand for a product is Q = 1200 − 4P and supply is Q...

Suppose that demand for a product is Q = 1200 − 4P and supply is Q = −240 + 2P. Furthermore, suppose that the marginal external damage of this product is $12 per unit. a. Graph the supply and demand curves. Show the marginal external damage on your graph. b. How many more units of this product will the free market produce than is socially optimal? c. What is the socially optimal price of the product? c. Calculate the deadweight loss associated with the externality.

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i hope this would help you thank you !

Rahul Sunny answered 2 years ago
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