1. Beef cattle produce methane, a greenhouse gas that contributes to global warming. a. Identify the market that has failed: b. What type of market failure is this? c. Diagram: d. Explain: e. Possible government solutions:

Question

1. Beef cattle produce methane, a greenhouse gas that contributes to global warming. a. Identify the market that has failed: b. What type of market failure is this? c. Diagram: d. Explain: e. Possible government solutions:

Answer 1

a. The market that has failed is the beef cattle market.b. This type of market failure is an externality, specifically a negative externality.c. Diagram: (Since I cannot draw diagrams, I'll describe it)- Draw a standard supply and demand graph.- Label the vertical axis as "Price" and the horizontal axis as "Quantity."- The demand curve (D) slopes downward.- The private supply curve (S) slopes upward.- Draw a second supply curve to the left of the private supply curve, labeled "Social Supply" (S_social), which includes the external costs of methane emissions.- The intersection of the demand curve (D) and the social supply curve (S_social) represents the socially optimal quantity and price.d. Explanation:The production of beef cattle generates methane, a greenhouse gas that contributes to global warming. This creates a negative externality because the social cost of methane emissions is not reflected in the market price of beef. As a result, the market equilibrium quantity of beef is higher than the socially optimal quantity, leading to overproduction and excessive pollution.e. Possible government solutions:- Implementing a tax on beef production equivalent to the external cost of methane emissions (Pigovian tax).- Providing subsidies for research and development of more sustainable farming practices.- Imposing regulations or caps on methane emissions from cattle farms.- Encouraging consumers to reduce beef consumption through public awareness campaigns.

Вопрос

1. Beef cattle produce methane, a greenhouse gas that contributes to global warming. a. Identify the market that has failed: b. What type of market failure is this? c. Diagram: d. Explain: e. Possible government solutions:

Решения

Ответ

Вопрос

1. Beef cattle produce methane, a greenhouse gas that contributes to global warming. a. Identify the market that has failed: __ b. What type of market failure is this? __ c. Diagram: d. Explain: e. Possible government solutions:

Решения

Ответ

1. Beef cattle produce methane, a greenhouse gas that contributes to global warming. a. Identify the market that has failed: b. What type of market failure is this? c. Diagram: d. Explain: e. Possible government solutions: