Evaluating a Nation's Environmental Progress

A city government organizes a public laser light show. While anyone can see it, they decide to sell tickets for a special viewing area with synchronized music. The demand for tickets is represented by the following schedule:

• Price $12: 0 tickets sold
• Price $10: 100 tickets sold
• Price $8: 200 tickets sold
• Price $6: 300 tickets sold
• Price $4: 400 tickets sold
• Price $2: 500 tickets sold
• Price $0: 600 tickets sold

If the city sets the ticket price at $6, what is the total social benefit generated from the ticketed viewing area?

Calculating Social Benefit for a Subscription Service

Evaluating a Change in Service Provision

When a private company sells a digital news subscription, the total social benefit created from this service is correctly measured by the total revenue the company collects from its subscribers.

A community develops an online platform offering high-quality local history video lectures. Access is granted via a monthly subscription. The demand for subscriptions is shown in the table below:

If the community sets the subscription price at $8 per month, what is the total social benefit generated per month from this service? Assume the demand curve is linear between the points given.

Evaluating Social Benefit of a Subscription Service

A private company offers an online, ad-free video streaming service for a monthly fee. The graph below illustrates the market demand for this service. The company sets a price at P*, which results in Q* subscribers. This pricing strategy creates three distinct areas under the demand curve:

• Area A: The triangle above the price P* and below the demand curve, from a quantity of 0 to Q*.
• Area B: The rectangle with height P* and width Q*.
• Area C: The triangle under the demand curve between quantity Q* and the maximum quantity demanded at a price of zero.

Match each economic concept with the area (or combination of areas) that correctly represents it in this market.

Impact of Pricing on Social Benefit

Pricing Strategy Analysis for a Community Streaming Service

Evaluating a Change in Service Provision