Consider the above graph. Is there an externality present in this market? If so, what kind?   No, there is no externality.   Yes, a negative externality.   Yes, a positive externality.

Q: WAGE (Dollars per hour) 16 14 12 10 2 0 Supply Demand 0 200 400 600 800 1000 1200 1400 1600 LABOR…

A: The government set a maximum and minimum price for products on the market. The regulation of these…

Q: A project earns cash flows of $100 per month and the monthly discount rate is 0.5%. The present…

A: Cash flow:The sum of the total money is represented in the diagram. It represents the magnitude and…

Q: Use the table to answer the following questions: Public Debt over Time United States France Italy…

A: Debt-to-GDP Ratio: The debt-to-GDP ratio used to assess a country's fiscal health. It represents the…

Q: 1. Climate change is caused the emissions of carbon dioxide and methane gases, i.e., so- called…

A: Efficiency: Efficiency means achieving a goal at least cost to society, ensuring that the marginal…

Q: An open market purchases of government bonds by the federal reserve results in ___ in the supply of…

A: Open market operation refers to the buying and selling of government bonds and securities by the…

Q: 130 120 110 100 + If the Fed fears inflation, it by OA. decreases aggregate supply; selling OB.…

A: Money supply:The Federal Reserve Bank regulates the money supply in the economy, thus controlling…

Q: Assume there is an increase in the minimum wage and it is binding. Please select all the true…

A: Minimum wage is the legally ordered least hourly wage rate that employers are expected to pay to…

Q: When cyclical unemployment increases and other things remain the same...   a. The amount of…

A: Cyclical unemployment refers to the unemployment generated because of a business cycle.For example…

Q: Select all that apply In which of the following four ways can businesses benefit society? By…

A: Businesses are organizations that participate in economic activity by providing buyers with goods…

Q: Use the bar graph from the World View "GDP per Capita around the World" to answer two questions.…

A: Gross Domestic Product (GDP) per capita is a measure of a country's economic performance and…

Q: Refer to Figure 12-6. Suppose this firm is being regulated using a policy of marginal- cost pricing.…

A: The marginal pricing rule is the one where the firm sets its price based on the marginal cost. In…

Q: The following graph shows the market for loanable funds in a closed economy. The upward-sloping…

A: Demand curve is a downward sloping curve. Supply curve is the upward sloping curve. Equilibrium is…

Q: Exercise 5 For each of the production functions below: (1) find the marginal product of labor (i.e.,…

A: Production function : q (L ,K ) = 5L0.75K0.25Where , L : labor input K : Capital input Hi there , as…

Q: Which of the following events would cause a movement upward and to the left along the demand curve…

A: Demand curve is the downward sloping curve. Demand schedule is the tabular representation of…

Q: Exercise 3 Consider a firm with production function of the q (L, K) = L√K, where q is the quantity…

A: An isoquant is a concept used in economics to represent a graphical or mathematical relationship…

Q: In Example 2.8, we discussed the recent increase in world demand for copper, due in part to China's…

A: Demand shows the relation between P and Q that consumers are willing to buy, assuming all other…

Q: Institutions and laws, such as patent protection, that foster innovations lead to economic growth…

A: The increase in a country’s production of goods and services, typically measured by the rise in its…

Q: Consider a perfectly competitive market with demand curve given by p = 602QD. If the market supply…

A: The demand curve is the downward-sloping curve. The supply curve is the upward-sloping curve. The…

Q: offee grown in Guatemala is priced at 17 Guatemalan quetzal per pound (Guatemalan quetzal, or GTQ,…

A: The nominal exchange rate—the price of a dollar in the US, for instance—and the ratio of prices in…

Q: Figure F shows the production possibilities of Robinson and Friday per hour. The comparative…

A: The quantity of one good that must be given up in order to produce one more unit of output is known…

Q: The marginal rate of substitution is the slope of an indifference curve. True False

A: Indifference curve basically refers to a graphical representation of all possible combination of two…

Q: 3. Consider the following utility function: U = 5 x1 + 2 x2 Also consider the following bundles:…

A: Total utility:Total utility is the sum total of the utility or satisfaction that is derived from the…

Q: Which of the following is NOT an endogenous variable in the Romer model? The stock of knowledge The…

A: Paul M. Romer developed the Romer model, which is also known as the endogenous growth model. This…

Q: The monthly market basket for consumers consists of pizza, t-shirts, and rent. The table below shows…

A: CPI is the consumer price index. The CPI is used to calculate the inflation rate. The CPI is…

Q: Consider the market for first-aid training classes. Market demand is given by P = 600 - Q. Market…

A: Externality is a cost of benefit imposed on a third party who is neither part  of consumption nor…

Q: The owners of a small manufacturing concern have hired a vice president to run the company with the…

A: Managerial Economics:Managerial Economics is utilized in making better decisions in the firm using…

Q: "Everyone is hurt by inflation." That statement is: A. Correct B. Incorrect…

A: Inflation refers to the increase in the average price level of the goods and and services in an…

Q: QUESTION 11 11. Assuming a required reserve ratio of 10%, the simple money multiplier is QUESTION 12…

A: The change in the quantity of deposits influences the money supply and these deposits lead to an…

Q: What are the implications of this model for "convergence" of income levels and income growth rates -…

A: Economic analysis is the precise investigation of how individuals, organizations, state run…

Q: Consider a competitive market in which the MPB = 129-3q and the MSC =3q. In this market, however,…

A: The market equilibrium quantity is where the private marginal benefit curve intersects the private…

Q: Consider an economy with three consumers, each with a marginal benefit for a public good of MB =…

A: The efficient level of output, with regards to economics, alludes to the quantity of a good or…

Q: A man wishes to provide a fund for his retirement such that from his 60th to 70th birthdays he will…

A: The present value can be defined as the amount invested in order to realize the future value. Future…

Q: Suppose Canada's economy is in a long run equilibrium with real GDP equal to potential output Now…

A: Aggregate demand is the sum of consumption, investment, government spending and net export. This…

Q: An investor with an initial endowment of $ 16,000 is confronted with the following productivity…

A: NPV stands for Net Present Value. It is a financial metric that is used to evaluate the…

Q: Case: Recycling services for private businesses can be purchased from many firms in a competitive…

A: Equilibrium refers to the situation in the market when quantity demand by consumers equals the…

Q: True or False 22. The incidence of a payroll tax is borne by both employers and employees.

A: Disclaimer- “Since you have asked multiple questions, we will solve the first question for you as…

Q: 3. Relationship between tax revenues, deadweight loss, and demandelasticity The government is…

A: Dead weight loss: It is defined as the loss of total welfare (or the total surplus = consumer…

Q: Which of the following best describes a monopolistically competitive firm? Group of answer choices a…

A: A  market for which they do not have perfect substitutes for one another and have multiple similar…

Q: The following graph gives the long-run Phillips curve (LRPC) and two potential short-run Phillips…

A: In the short run, Phillips describes the relationship between inflation and the unemployment rate.…

Q: Price (dollars) 6 & 0 Market Q₁ Q Quartity D Price (dollars) & Firm 9 Quantity 4 q1 This firm will…

A: In perfect competition, There exists a large number of buyers and sellers. The firm will produce…

Q: Onsider the following dynamic game:

A: If players move consecutively or frequently throughout the course of the game, it is dynamic.…

Q: How is the fit of the model associated with the value of Significance F? - the greater the fit, the…

A: The ANOVA (Analysis of Variance) table in the regression output summary provides a statistical test…

Q: The maximum value of B is (Simplify your answer. Type an exact answer, using radicals as needed.)

A: The consumer tends to maximise his utility given thevonstraint that it faces

Q: Quantity 1 2 3 4 Muffins Marginal Utility 80 70 O a. 145 utils. O b. 331 utils. O c. 96 utils. O d.…

A: Utility maximization problem: With the given prices and income, a consumer chooses his consumption…

Q: -. In microeconomics the two fundamental assumptions that resources are finite, but conomic wants…

A: PPC:Graphical representation of the combination of two goods that can be produced in the economy in…

Q: Which of the following exemplifies a microeconomic question? What is the current national rate of…

A: Microeconomics is a branch of economics that focuses on the study of individual economic agents and…

Q: Suppose a change in exchange rates causes aggregate demand to decrease. What is the result? Choose…

A: The value of one currency in relation to another is shown by the exchange rate. This is the cost at…

Q: Consider the game below with a worker (W) and a firm (F). The worker initially can choose to acquire…

A: One of the most crucial ideas in game theory is the notion of Nash equilibrium. When no player would…

Q: What will the federal government do to taxes?

A: The federal government uses fiscal policy as a tool to achieve economic stability.This involves…

Q: QUESTION 3 You are considering subscribing to ESPN+. You are willing to pay up to $83 per year for a…

A: The difference between the price that a consumer is willing to pay for a good or service and the…

Market Failure Analysis

To understand Market failure, we need to first understand welfare economics. An Italian economist, Vilfredo Pareto stated that allocation of resources in an efficient manner such that an economic change, which harms no one and makes someone better off, indicates an increase in social welfare. It is also called Pareto Optimality, where resources cannot further be reallocated without harming one. This does not apply to those economic changes, which harm some and benefit others. social welfare increases if the utility of any of its members' increases and none decrease in the economy.