Unit 6: Diagram Review

Identify the externality

• Negative externality of consumption

• Negative externality of production

• Positive externality of consumption

• Positive externality of production

What is the socially optimal quantity

• 13

• 20

• 9

• 14

What is the market quantity and price

• Q: 9

  P: 20

• Q: 13

  P: 12

• Q: 13

  P: 9

• Q: 13

  P: 7

What is the value of the tax needed to eliminate deadweight loss?

• $5

• $9

• $7

• $14

Identify the externality

• Negative externality of consumption

• Negative externality of production

• Positive externality of consumption

• Positive externality of production

What is the market price and quantity?

• P: P2

  Q: Q2

• P: P2

  Q: Q1

• P: P3

  Q: Q1

• P: P1

  Q: Q1

Identify the deadweight loss

• ACD

• BCD

• ABD

• P3 - P1

What is the value of the per unit subsidy needed to eliminate deadweight loss?

• P3 - P1

• P2 - P1

• Q2 - Q1

• P3 - P2

Identify the externality

• Negative externality of consumption

• Negative externality of production

• Positive externality of consumption

• Positive externality of production

Identify the externality

• Negative externality of consumption

• Negative externality of production

• Positive externality of consumption

• Positive externality of production