In the ice bag example, what happens when the price is kept at $4.39 a bag? Group of answer choices The last five people get ice. Everyone gets ice. The last five people get no ice. Yet one or more of the last five applicants may need the ice more desperately than any of the first five. Everyone is happy with the price of $4.39.
Added by Sean M.
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39. - If the price of an ice bag is set at $4.39, we need to consider how many people are willing to pay this price. This will depend on the individual willingness to pay (WTP) of each person in the market. Show more…
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Look at the tables below, which show, respectively, the willingness to pay and willingness to accept of buyers and sellers of individual bags of oranges. For the following questions, assume that the equilibrium price and quantity will depend on the indicated changes in supply and demand. Assume that the only market participants are those listed by name in the two tables. Instructions: Enter your answers as whole numbers. a. Given the equilibrium price of $10, what is the equilibrium quantity given the data above? b. What if, instead of bags of oranges, the data in the two tables dealt with a public good like fireworks displays? If all the buyers free ride, what will be the quantity supplied by private sellers? c. Assume that we are back to talking about bags of oranges (a private good), but that the government has decided that tossed orange peels impose a negative externality on the public that must be rectified by imposing a $4-per-bag tax on sellers. What is the new equilibrium price? What is the new equilibrium quantity? If the new equilibrium quantity is the optimal quantity, by how many bags were oranges being overproduced before?
Crystal W.
Look at the tables below, which show, respectively, the willingness to pay and willingness to accept of buyers and sellers of individual bags of oranges. For the following questions, assume that the equilibrium price and quantity will depend on the indicated changes in supply and demand. Assume that the only market participants are those listed by name in the two tables. Instructions: Enter your answers as whole numbers. a. Given the equilibrium price of $8, what is the equilibrium quantity given the data above? Q* = bag(s). b. What if, instead of bags of oranges, the data in the two tables dealt with a public good like fireworks displays? If all the buyers free ride, what will be the quantity supplied by private sellers? Q* = . c. Assume that we are back to talking about bags of oranges (a private good), but that the government has decided that tossed orange peels impose a negative externality on the public that must be rectified by imposing a $2-per-bag tax on sellers. What is the new equilibrium price? P* = $. What is the new equilibrium quantity? Q* = bag(s). If the new equilibrium quantity is the optimal quantity, by how many bags were oranges being overproduced before? Q* = bag(s).
Andrew D.
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