Question

O Od Visitors to the park must pay an admittance fee, but there are always plenty of empty picnic tables. Visitors to the park must pay an admittance fee and frequently all of the picnic tables are in use. QUESTION 26 Table 10-2 The following table shows the private value, private cost, and social value for a market with a positive externality. Quantity Private Value Private Cost Social Value 4 10 18 18 s . 12 26 Refer to Table 10-2. How large would a subsidy need to be in this market to move the market from the equilibrium level of output to the socially optimal level of output? O a 37 Ob 33 Oc.39 Od 35 QUESTION 27 Citizens expect the government to provide various goods and services making taxes antolerable binevitable O equitable Od inefficient Click Save and submit to save and submit Click Save All Annwers to sat all annuere.

Answer 1

26) It is $7. This is because private value and social value differ by $7 at each quantity

27) Inevitable. Government has to finance its activities and taxes are the easiest way to collect revenue for such financing. People or the beneficiaries expect government to make taxes inevitable in order to continue supply these goods / services.