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The graph shows the unregulated market for electricity. The marginal external cost of the pollution created is equal to the marginal private cost of producing electricity at every quantity of electricity produced. XXX Draw a point to show the marginal social cost when production is 500 kilowatts per day. Label it 1. Draw the marginal social cost curve. Label it MSC. Draw a point to show the quantity of electricity produced with no pollution control and the marginal social cost of the electricity generated. Label it 2. Draw a shape to show the deadweight loss with no pollution control. Label it DWL. The deadweight loss created by the pollution is s >>> Remember that the price given on the y-axis is in cents but you must answer in dollars. 24- 20- 16- 12- 8- Price and cost (cents per kilowatt) 100 S=MC D 300 400 200 Quantity (kilowatts per day) >>> Draw only the objects specified in the question. 500 600

The graph shows the unregulated market for electricity. The marginal external cost of the pollution created is equal to the marginal private cost of producing electricity at every quantity of electricity produced. XXX Draw a point to show the marginal social cost when production is 500 kilowatts per day. Label it 1. Draw the marginal social cost curve. Label it MSC. Draw a point to show the quantity of electricity produced with no pollution control and the marginal social cost of the electricity generated. Label it 2. Draw a shape to show the deadweight loss with no pollution control. Label it DWL. The deadweight loss created by the pollution is s >>> Remember that the price given on the y-axis is in cents but you must answer in dollars. 24- 20- 16- 12- 8- Price and cost (cents per kilowatt) 100 S=MC D 300 400 200 Quantity (kilowatts per day) >>> Draw only the objects specified in the question. 500 600

Essentials of Economics (MindTap Course List)
Essentials of Economics (MindTap Course List)
8th Edition
ISBN:9781337091992
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter10: Externalities
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Problem 3PA: Greater consumption of alcohol leads to more motor vehicle accidents and, thus, imposes costs on...
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% 5 The graph shows the unregulated market for electricity. The marginal external cost of the pollution created is equal to the marginal private cost of producing electricity at every quantity of electricity produced. 8 Draw a point to show the marginal social cost when production is 500 kilowatts per day. Label it 1. Draw the marginal social cost curve. Label it MSC. Draw a point to show the quantity of electricity produced with no pollution control and the marginal social cost of the electricity generated. Label it 2. Draw a shape to show the deadweight loss with no pollution control. Label it DWL. The deadweight loss created by the pollution is $ >>> Remember that the price given on the y-axis is in cents but you must answer in dollars. t 6 y h Selected: none & 7 O * 8 k ✓ ( 9 24 20 16- 12 8- 4- 0- Price and cost (cents per kilowatt) 0 200 300 400 500 Quantity (kilowatts per day) >>> Draw only the objects specified in the question. D Delete Clear " 100 ) 0 р ? .. S=MC ✔ D 600 38 16 Next Q x S US
Transcribed Image Text:% 5 The graph shows the unregulated market for electricity. The marginal external cost of the pollution created is equal to the marginal private cost of producing electricity at every quantity of electricity produced. 8 Draw a point to show the marginal social cost when production is 500 kilowatts per day. Label it 1. Draw the marginal social cost curve. Label it MSC. Draw a point to show the quantity of electricity produced with no pollution control and the marginal social cost of the electricity generated. Label it 2. Draw a shape to show the deadweight loss with no pollution control. Label it DWL. The deadweight loss created by the pollution is $ >>> Remember that the price given on the y-axis is in cents but you must answer in dollars. t 6 y h Selected: none & 7 O * 8 k ✓ ( 9 24 20 16- 12 8- 4- 0- Price and cost (cents per kilowatt) 0 200 300 400 500 Quantity (kilowatts per day) >>> Draw only the objects specified in the question. D Delete Clear " 100 ) 0 р ? .. S=MC ✔ D 600 38 16 Next Q x S US
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The graph shows the unregulated market for electricity.
 
Suppose that at every quantity produced, the marginal external cost of electricity equals the marginal private cost of production.
 
To show the market outcome, draw the following four items on the graph:
 
1. Draw a point to show the marginal social cost when the utility produces 500 kilowatts per day. Label it 1.
2. Draw the marginal social cost curve. Label it
MSC
.
3. Draw a point to show the electricity produced and its marginal social cost. Label it 2.
4. Draw a shape to show the deadweight loss created. Label it
DWL
.
>>>
Draw only the objects specified in the
question.
 
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