Refer to the figure in the attachment to answer the following questions. The figure represents...
Question:
Refer to the figure to answer the following questions. The figure represents the market for vanccines with external benefits.
A) What is the efficient quantity?
B) Relative to the efficient quantity, does the market over- or underproduce the vaccine? And by how much?
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Market Equilibirum
Market equilibrium is the point where the quantity demanded by consumers is equal to the quantity supplied by producers. At this quantity the price of both the supply and demand functions will be equal and as long as the market is in equilibrium the prices are controlled by consumer and producer preferences.
Answer and Explanation: 1
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View this answerA) The efficiency quantity is 1,500 this is the initial intersection of supply and demand.
B) The market overproduces the vaccine because the...
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Market Equilibrium in Economics: Definition & Examples
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Chapter 3 / Lesson 10
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What is market equilibrium? Learn the market equilibrium definition and study examples. See how supply and demand impact prices when a market is in equilibrium.
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