Question
The Smith School is distributing Blackberry devices to full-time MBA students and faculty. The marginal cost of providing a Blackberry is $200. There were two
The Smith School is distributing Blackberry devices to full-time MBA students and faculty. The marginal cost of providing a Blackberry is $200. There were two different demand curves, one for faculty and one for students. They are: Qfaculty=100- P 5, and Qstudents=300-P. When students receive Blackberries, the faculty demand curve shifts up by $50. When faculty receive Blackberries, the student demand curve shifts up by $50.
a. What is the quantity of Blackberries that maximizes social welfare if Blackberries are distributed to students and not to faculty? N
b. What is the quantity of Blackberries that maximizes social welfare if Blackberries are distributed to faculty and not to students? N
c. What is the quantity of Blackberries that maximizes social welfare if Blackberries are distributed to faculty and students? N
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