Answered step by step
Verified Expert Solution
Question
1 Approved Answer
The table below shows the marginal private benefits and the marginal private costs of flu shots. The marginal private benefits represent the market demand curve
The table below shows the marginal private benefits and the marginal private costs of flu shots. The marginal private benefits represent the market demand curve {DIN}, and the marginal private costs represent the market supply curve (SW). Marginal private Marginal Quantity Of flu benefits private costs ShOts Dlnternal Slnternal 1,000 $2,500 $1,800 2,000 $2,250 $1,900 3,000 $2,000 $2,000 4,000 $1,?50 $2.100 5,000 $1,500 $2,200 6,000 $1,250 $2,300 7,000 $1,000 $2,400 8,000 $750 $2,500 9,000 $500 $2,600 Suppose that getting a flu shot generates a positive externality, and the external benefit is $2,200 per thousand flu shots. Compared to the socially optimal amount of flu shots, the amount of flu shots taken at the market equilibrium is _____ shots too few
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started