Resource Economics 262 Problem Set 1 15 points Due February 11 2021 4 pm Two versions of this assignment are posted an MSWord version and a pdf version You may either 1 type your answers directly on the Word version convert that to a pdf and submit the pdf version or 2 write your answers on a separate document convert that to a pdf and submit the pdf You must submit a pdf copy Do not simply cut and paste material from my lectures Please include your name and your student ID number on your submission Also name the file you submit your full name RESECON262HW 1 pdf Please make sure that you upload and submit your assignment when you are done Warning for MAC users Graphs in this assignment may not convert correctly if you download the MSWord version of this document with a program other than Microsoft Office I believe you can install a free version of Microsoft Office through UMass IT Alternatively you can download the pdf version of the assignment write your answers in a separate document convert that to pdf and submit that document 1 Use the logic of willingness to pay to interpret the statement I like clean air more than you do 1 points 2 Below is the marginal willingness to pay schedule of a consumer for organic apples Assume that people cannot eat fractions of apples Consumption Apples per week 1 2 3 4 5 6 Marginal willingness to pay 4 00 3 20 2 60 2 20 1 80 1 50 2 1 What is this individual s total willingness to pay for 4 apples in a week 1 point 2 2 If the price of apples is 2 40 how many apples would this person consume Explain 2 points 1 3 In the graph below is an individual s marginal willingness to pay schedule for a good q Identify the individual s marginal willingness to pay for the q 1 the individual s total willingness to pay for q 1 units of the good 2 points th unit of the good Also identify 4 In the graph below is the marginal willingness to pay schedules for two individuals A and B for environmental quality at a point in time 4 1 Give two possible reasons why B s marginal willingness to pay for environmental quality is higher than A s 2 points 4 2 In the graph indicate the benefit to B of a policy that increases the level of environmental quality from q0 to q1 1 point 4 3 In the graph indicate the benefit to A of a policy that increases the level of environmental quality from q0 to q1 1 point 4 4 What is the benefit to B and A together of a policy that increases environmental quality from q0 to q1 1 point f 2 5 Define the economic concept of external costs Use an environmental example to illustrate the concept 2 points 6 In the graph below is a firms marginal cost schedule for producing a good q If the price of the firm s output is x how much will the firm produce What is the firm s total cost of producing this level 2 points 3