Suppose That the Economy Is Composed of Two Individuals, a and B

question 19

Multiple Choice

Suppose that the economy is composed of two individuals, A and B. Their respective demand curves for a public good, y, are given by: y_A = 50 - p/2 and y_B = 25 - p. The marginal social value (MSV) function is:

• A)MSV = 75 - 3p/2.
• B)MSV = 75 - y.
• C)MSV = 125 - 3y.
• D)MSV = 25 + p/2.

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Definitions:

Manufacturing Business

A type of business that produces finished goods from raw materials by using various processes, machinery, and operations.

Financial Accounting

The field of accounting focused on the summary, analysis, and reporting of financial transactions related to a business.

Managerial Accounting

Refers to the process of identifying, measuring, analyzing, interpreting, and communicating information for the pursuit of an organization's goals.

Objective

A specific, measurable, achievable, relevant, and time-bound goal that drives strategic and operational planning.