The graph shows the demand for design school education. The marginal cost of this education is a constant $4,000 per student per year and the marginal external benefit is a constant $3,000 per student per year. If the government provides public design schools, what tuition will achieve the efficient number of students? How much will taxpayers have to pay? Draw the marginal social cost curve. Label it MSC. Draw the marginal social benefit curve. Label it MSB. Draw a line that shows the tuition that schools charge to achieve the efficient number of students. Label it Tuition. The tuition that colleges charge is $.000 per student. The amount paid by taxpayers is $.000 per student. 144 124 10- 8- 6- 4- 24 Price and cost (thousands of dollars) X MSB D-MB 20 40 60 80 100 120 140 Students (thousands per year). I Q Q G (0,0) >>> Draw only the objects specified in the question.

The graph shows the demand for design school education. The marginal cost of this education is a constant $4,000 per student per year and the marginal external benefit is a constant $3,000 per student per year. If the government provides public design schools, what tuition will achieve the efficient number of students? How much will taxpayers have to pay? Draw the marginal social cost curve. Label it MSC. Draw the marginal social benefit curve. Label it MSB. Draw a line that shows the tuition that schools charge to achieve the efficient number of students. Label it Tuition. The tuition that colleges charge is $.000 per student. The amount paid by taxpayers is $.000 per student. 144 124 10- 8- 6- 4- 24 Price and cost (thousands of dollars) X MSB D-MB 20 40 60 80 100 120 140 Students (thousands per year). I Q Q G (0,0) >>> Draw only the objects specified in the question.

Economics (MindTap Course List)

13th Edition

ISBN:9781337617383

Author:Roger A. Arnold

Publisher:Roger A. Arnold

Chapter30: Market Failure: Externalities, Public Goods, And Asymmetric Information

Section: Chapter Questions

Problem 10QP

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