Scenario 10-4 the Demand Curve for Fire Extinguishers Slopes Downward and the and the Supply

question 167

Essay

Scenario 10-4
The demand curve for fire extinguishers slopes downward and the supply curve for fire extinguishers slopes upward. The production of the 500^th fire extinguisher entails the following:
• a private cost of $10;
• an external cost of $0;
• a private value of $9;
• an external benefit of $3.
-Refer to Scenario 10-4. Is the socially-optimal quantity of fire extinguishers less than, equal to, or greater than 500? Explain.

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Definitions:

Exclusive Commitments

Decisions or pledges that involve dedicating oneself completely to a single cause, relationship, or activity to the exclusion of all others.

Increased Self-Esteem

The elevated sense of worth or value that an individual perceives about themselves.

Deportation

The act of formally removing a foreign national from a country for violating immigration laws.

Symptoms of Depression

The signs and emotional, physical, and cognitive manifestations associated with the mood disorder depression, such as persistent sadness, loss of interest, and fatigue.