23. The social actual marginal benefit of building the park and playground is ______ and the social actualmarginal cost is _______.(1)$270,000; $60,000(2)$220,000; $190,000(3)$60,000; $270,000(4)$200,000; $180,000(5)None of the above24. The rational decision (privately) is ______; the good decision (privately) is ______.25. Society wants us ______ the park and playground because social economic surplus would be equalto _____ if we build the park and playground.26. If we build the park and playground we expect to earn _____ in economic surplus and we willactually earn _______ in economic surplus (privately).27. This decision to build the park and playground includes a _________.(1)Positive consumption externality(2)Negative consumption externality(3)Positive production externality(4)Negative production externality(5)Impossible to determine with the information provided
1028. If society wants this builder to build the park and playground it will have to offer a ______ of at least_____.2. Basics of the Free Market ModelSuppose the following graph represents the market for wheat. Use this graph to answer the followingquestions about the way the free market system works to allocate scarce resources.a.What will be the market equilibrium price and the market equilibrium quantity of wheat boughtand sold? Suppose the price originally starts out below the equilibrium price. Explain how themarket gets to the equilibrium price?If price starts too low then Qd>Qs and we have an excess demand which signals producers toraise price. This causes Qd to fall and Qs to rise until they finally meet at equilibrium.0510152025303540455055606570758085909510002468101214161820222426Price (U.S. dollars)Quantity (millions of bushels)Market DemandMarket SupplyPe=Qe=New MarketDemandNewPe=NewQe=50% increase
11b.Using the point‐slope formula, what is the price elasticity of demand at equilibrium? Is this therevenue maximizing price? How can you tell?