MPB = 90 – 4Q; MSB = 80 - 4Q; MC: P = 30 + Q;
Q |
MPB |
MSB |
MC |
P=MR |
0 |
90 |
80 |
30 |
35 |
5 |
70 |
60 |
35 |
35 |
10 |
50 |
40 |
40 |
35 |
15 |
30 |
20 |
45 |
35 |
20 |
10 |
0 |
50 |
35 |
25 |
-10 |
-20 |
55 |
35 |
A. As the MSB and MPB is greater than the cost associated at price of $35, the consumers would get the rabies vaccine for their dogs.
B. From the social perspective, the rabies would yield in positive externality and hence consumers should get their dogs vaccinated with rabies
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