Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The Private Marginal Benefit of acquiring a university degree is 1000 - Q (where Q is the total number of persons obtaining a university degree).

image text in transcribed
image text in transcribed
The Private Marginal Benefit of acquiring a university degree is 1000 - Q (where Q is the total number of persons obtaining a university degree). The Social Marginal Benefit is 3000 - Q. PMC = SMC = 100. To have the efficient number of persons obtain a university degree it will be necessary to: O Provide a subsidy of 2900 to each individual who acquires a university degree O Set a maximum limit on the number of persons obtaining a university degree equal to 2900. O Require that at least 2000 people obtain a university degree. O Impose a tax of 2000 on each individual who does not obtain a university degree. O Provide a subsidy of 2000 to each individual who acquires a university degree

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Principles Of Microeconomics

Authors: N Gregory Mankiw

9th Edition

035713348X, 9780357133484

More Books

Students also viewed these Economics questions

Question

1. What will happen in the future

Answered: 1 week ago

Question

3. Avoid making mistakes when reaching our goals

Answered: 1 week ago