Question: widgets are a necessary part of modern life but they...
Widgets are a necessary part of modern life, but they are also associated with considerable pollution and pollution-related externalities. Consider the private market for widgets described by the following private marginal benefit (MB) and private marginal cost (PMC) curves:
𝑀𝑀𝑀𝑀 = 100 − 0.15𝑄𝑑
PMC = 4 + 0.06𝑄𝑄𝑠𝑠.
where 𝑄𝑑 is the quantity demanded and 𝑄𝑠 is the quantity supplied. Assume here that output (𝑄𝑠 and 𝑄𝑑) varies from 0 to 1000. After plotting these curves, use them to answer the following
questions. (This question requires graphing for several parts—you can put all of your curves on the same figure. At the very least, I would like for you to try using Excel to plot the lines.)
a) (5points)Generate a graph of the MB and PMCcurves.