Scenario: Frank and Nancy Live in a Small Community on Cape

Multiple Choice

Scenario: Frank and Nancy live in a small community on Cape Cod in Massachusetts. For simplicity, assume Frank and Nancy are the only individuals in the community. Each has a demand for mosquito control, given by the following table, equations, and figure. Assume that mosquito control is a public good. Mosquito control is provided at a constant marginal cost of $120.

Frank's demand: qFᵣₐnk = 200 - p,
Frank's inverse demand = (Marginal Private Benefit) : p = 200 - q,
Nancy's demand: qNₐncᵧ = 100 - p,
Nancy's inverse demand = (Marginal Private Benefit) : p = 100 - q,

-Refer to the scenario above.Now suppose that mosquito control will be publicly provided.What is the market equilibrium quantity of mosquito control services provided? Explain your answer graphically.

A) 0 units
B) 80 units
C) 90 units
D) 120 units