Question
Consider the market for a product with a positive consumption externality.Assume the MB curve for this product is downward sloping.Draw a graph representing this market
Consider the market for a product with a positive consumption externality.Assume the MB curve for this product is downward sloping.Draw a graph representing this market that includes the MB, PMB, PMC, SMB and SMC curves and show QFMand Q*.What is the deadweight loss if the externality is not internalized?
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Foundations of Mathematical Economics
Authors: Michael Carter
1st edition
262531925, 978-0262531924
