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(Solved): 1. Will (a.k.a. the Fresh Prince) likes to play music loudly in his room, but his cousin, Carl ...



1. Will (a.k.a. the “Fresh Prince”) likes to play music loudly in his room, but his cousin, Carlton, wants a quiet atmosphere to study. (He really wants to go to Princeton for college.) The loud music causes a negative externality. Will has a marginal private cost (MPC) of playing music (tapes aren’t free) and a marginal benefit (MB) for each song. Consider the quantity (Q) to be the number of songs. MPC = 10 + 3Q MB = 65 – 2Q a. Based on this information, how many songs will Will play? I.e. what is the “private solution.” b. The externality can be represented by the marginal damage (felt by Carlton) where



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