Suppose a New Power Plant Meant to Provide Power to a Metropolitan

question 6

Multiple Choice

Suppose a new power plant meant to provide power to a metropolitan area is to be constructed and its power must go to urban and suburban areas.Suppose marginal cost is (1/6) Q and the marginal beneftis for urban areas is MB_U=1400-Q_U and marginal benefits for suburban areas is MB_S=2,000-(1/2) Q_S.
-What is the total quantity of electricity that should be produced?

• A)3,600
• B)4,000
• C)2,800
• D)3,400

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