Sep 25, 2017 term paper 2

SUPPOSE THE DEMAND CURVE FOR STEEL IS Q = 100 – P , WHERE P IS THE PRICE PER UNIT OF STEEL AND Q…

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Suppose the demand curve for steel is Q = 100 – P, where Pis the price per unit of steel and Qmeasures millions of units of steel. The private marginal cost of producing steel isMC = 5Q + 40, while the external marginal cost of producing steel is $12. In a perfectly competitive steel industry, the deadweight loss is:


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