For this question, refer to Figure 4 and the lettered indices below (for example, EFJ is the triangle made by those three points). Country I and Country II are considering a side-payments scheme to increase conservation. Country I is the local conservation provider, and so all costs fall upon Country I. However, both countries receive benefits from the conservation.

Figure 4: External Benefits to Conservation

What is the net increase in global net benefits of conserving at the global optimum relative to Country I’s private optimum in Figure 4 above?

Question

For this question, refer to Figure 4 and the lettered indices below (for example, EFJ is the triangle made by those three points). Country I and Country II are considering a side-payments scheme to increase conservation. Country I is the local conservation provider, and so all costs fall upon Country I. However, both countries receive benefits from the conservation.

Figure 4: External Benefits to Conservation

What is the net increase in global net benefits of conserving at the global optimum relative to Country I’s private optimum in Figure 4 above?

BlackTom AI · Accepted Answer

The social marginal benefit is MB_I + MB_II and the social (global) optimum Q0 is where MB_I + MB_II = MC_I. Country I’s private optimum Q_I is where MB_I = MC_I. The net increase in global net benefits from moving from Q_I to Q0 is the area ∫_{Q_I}^{Q0} [(MB_I + MB_II) − MC_I] dQ.

Step-by-step reasoning:
1) Identify optima: At Q_I: MB_I = MC_I (Country I’s private choice). At Q0: MB_I + MB_II = MC_I (global optimum).  
2) Write the welfare gain from increasing conservation from Q_I to Q0:
   ΔW = ∫_{Q_I}^{Q0} [(MB_I + MB_II) − MC_I] dQ.
3) Use the fact that at Q_I the curves meet so visually the incremental area between Q_I and Q0 is bounded above by the combined marginal benefit curve (MB_I + MB_II) and below by the marginal cost curve MC_I. That area is exactly the region shown in the figure between those two curves for the horizontal span Q_I → Q0.
4) Translate to the labelled regions: along the left vertical at Q_I, B is the point on MB_I (=MC_I). At the right vertical at Q0, E is the intersection of MB_I + MB_II and MC_I. G is the point on MB_I at Q0. Thus the triangle formed by B–E–G is the geometric area representing ∫_{Q_I}^{Q0} [(MB_I + MB_II) − MC_I] dQ. That triangle captures the extra combined benefits net of marginal cost over the interval Q_I to Q0.

Why other options are incorrect:
- HFCA, HGBA, DEB, ABGH correspond to regions under other curve pairs (e.g., under MC alone, under MB_II alone, or combinations that include baseline areas from 0 to Q_I) and do not represent the net global surplus gain from Q_I to Q0. They either include areas before Q_I or omit the correct vertical boundaries and so do not equal the integral above.

Conclusion: The net increase in global net benefits moving from Country I’s private optimum to the global optimum is the area BEG, matching the provided correct answer BEG.

类似问题

When production or consumption of a product results in negative externalities, a suitable method of government intervention may be

The marginal social cost (MSC) and the marginal external cost (MEC) at the socially optimal equilibrium would be MSC MEC A. $200 $200 B. $100 $0 C. $200 $100 D. $100 $200 E. $200 $0

You own a bond that pays $64 in interest annually. The face value is $1,000 and the current market price is $1,021.61. The bond matures in 11 years. What is the yield to maturity?

Which of the following statements is CORRECT?

更多留学生实用工具

智能学习助手

风格化写作助手

论文查重助手

文献引用助手

课堂转译助手

课堂笔记助手

Quiz搜索助手

学校历年真题

智能刷题助手

智能匹配练习

希望你的学习变得更简单