Suppose there is a public good that has market supply characterized by the equation X = (P/3) - (32/3). Suppose further that market demand for this good can be characterized by the equation X = 25 - P. Find the equilibrium quantity of the public good that will be supplied.
What will be an ideal response?
The two curves never intersect at a positive quantity; therefore, the amount of the public good provided will be zero.
You might also like to view...
Which of the following is true of tariffs?
A) Tariffs are special taxes levied on imports. B) Tariffs reduce the volume of exports. C) Tariffs decrease the prices of imports. D) Tariffs encourage international trade.
In the context of rent seeking, rents refer to _____
a. payments made to factors of production for private benefit that do not add anything to social output. b. payments made to politicians for private benefit that do not add anything to gross domestic product c. payments made to factors of production for private benefit that add to social output d. payments made to third parties to find opportunities for lobbying