The table above provides information about the marginal private benefit of education. The marginal private cost, which also equals the marginal social cost, of educating a student is $16,000 per year and does not change as more students are educated
There is an external benefit from education that is equal to $12,000 per student year and does not change as more students are educated. If the market for education is competitive and unregulated, the equilibrium quantity of education will be ________ and the tuition will be ________. A) 20,000 student-years; $20,000
B) 40,000 student-years; $16,000
C) 60,000 student-years; $12,000
D) 80,000 student-years; $8,000
B
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Which person has the highest opportunity cost of obtaining a college degree (assuming that attending college requires giving up his or her current position)?
a. Bill, who is unemployed. b. Jane, who is an unwed mother and earns $15,000 a year. c. Larry, who is a technician in the Navy earning $18,000 a year with free food and housing. d. Mary, who has a job earning $60,000 a year as a computer programmer. e. Unable to determine from the data given.
The absolute price elasticity of demand for a vertical demand curve
A) is infinite. B) is 1.0. C) is 0. D) depends on where one is on the demand curve.