Need help with 2nd year micro
- The private marginal benefit (PMB) for widgets is 100-6X.
- The private marginal cost (PMC) of producing X is 4X.
- The external marginal damage (MD) of each widget produced is $10.
1. The profit-maximizing output of widgets is
a. 4
b. 6
c. 8
d. 10
2. The socially efficient output of X is
a. 3 units
b. 5
c. 9
d. 10
3. The private cost of producing the 3rd widget is
a. $12
b. 18
c. 21
d. 23
4. The social cost of producing the 4th widget is
a. $12
b. 14
c. 22
d. 26
5. The social (=private) benefit (SMB=PMB) from consuming the 5th widget is
a. $40
b. 50
c. 70
d. 90
6. The net social benefit from the consumption of the 6th widget is
a. $30
b. 34
c. 64
d. 66
7. The “green tax” required to reach a socially efficient level of widgets (from the private market output) is
a. $2
b. 6
c. 8
d. 10
For #1 I put D and for #2 I put C, I'm struggling with the rest.
Would like solutions as well.
- The private marginal cost (PMC) of producing X is 4X.
- The external marginal damage (MD) of each widget produced is $10.
1. The profit-maximizing output of widgets is
a. 4
b. 6
c. 8
d. 10
2. The socially efficient output of X is
a. 3 units
b. 5
c. 9
d. 10
3. The private cost of producing the 3rd widget is
a. $12
b. 18
c. 21
d. 23
4. The social cost of producing the 4th widget is
a. $12
b. 14
c. 22
d. 26
5. The social (=private) benefit (SMB=PMB) from consuming the 5th widget is
a. $40
b. 50
c. 70
d. 90
6. The net social benefit from the consumption of the 6th widget is
a. $30
b. 34
c. 64
d. 66
7. The “green tax” required to reach a socially efficient level of widgets (from the private market output) is
a. $2
b. 6
c. 8
d. 10
For #1 I put D and for #2 I put C, I'm struggling with the rest.
Would like solutions as well.
I figured out the answer guys, nvm!
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