1.)There is a road between the suburbs and downtown. The road is congested at rush hour. If 100 people use the road at rush hour, the trip takes 30 minutes. If the 101^st person enters the road, everyone has to slow down and the trip now takes 31 minutes. People value their time at $6 per hour (i.e., $0.10 per minute). For simplicity, ignore all of the costs of using the road other than the cost of time.

The marginal social cost of the 101st person is $ ...

2.)Suppose demand is Q_D = 16 - P supply is Q_S = P. There is a constant positive externality of $4 per unit (Marginal External Benefit, MEB = $4). The maximum possible social surplus is $___.

3.) Suppose demand is given by Q_D = 6 - P.

If the initial price is $2, and it goes up to $4. The change in the consumer surplus is minus (-) $___.

4.) Suppose the market wage facing a firm in the perfectly competitive pencil-making industry is $20 per hour, and the firm sells its pencils for $2 each. Given this information, the firm should hire workers until the marginal product of labor equals ________ pencils per hour.