Use the Following to Answer Questions

question 83

Multiple Choice

Use the following to answer questions :
Figure: Market Failure
-(Figure: Market Failure) Use Figure: Market Failure.Suppose that the supply curve represents the marginal cost of providing streetlights in a neighbourhood where only two people,Ann and Joe,reside.The demand curve represents the marginal benefit that Ann receives from the streetlights.Suppose that Joe's marginal benefit from the streetlights is a constant amount equal to the vertical distance A-C.If Ann is the only person to pay for the streetlights,how many lights will be provided?

• A) 0
• B) E
• C) F
• D) G

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