The diagram below shows the marginal benefit and marginal cost of a public good.This economy has 3 individuals,A,B and C.The diagram shows the MB for each individual and a summation of their marginal benefits.
FIGURE 16-4
-Refer to Figure 16-4.The curve MBABC is derived by
A) a vertical summation of the marginal benefits of all individuals at each level of output.
B) observation of the consumption of public goods at a price of zero.
C) observation of the consumption of public goods at the optimal price.
D) a horizontal summation of the marginal benefits of all individuals at each given price level.
E) determining the private marginal cost of the public good.
Correct Answer:
Verified
Q45: The diagram below shows the supply and
Q59: An example of a common-property resource is
A)a
Q61: Under what circumstances would it be efficient
Q65: An efficient level of provision of a
Q68: An example of a public good is
A)apples
Q69: If you consume some good,and by doing
Q70: One reason that national defence is a
Q75: How might a government intervene in a
Q81: Which of the following is the best
Q96: It is inefficient for the government to
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents