7.6 Positive Externalities and Pigouvian Subsidy AP Micro

[@andrewkitchener2324]

mans been working out

[@khb_id1313]

This really helped me with my exams, thank you!

[@nainaarora332]

Really helpful! Thank you!

[@sarahpersico5404]

What would the new consumer and producer surplus be after the subsidy??

[@eddyshasha1996]

i know this is a year late but to calculate the CS and PS would actually be quite simple it's just that it's weird because the supply and demand with the subsidy don't intersect (since buyers pay a lower price than sellers receive). So to calculate it just draw a line from the price buyer pay all the way to the y axis and draw the triangle (the math equation would be the price of the subsidy x qe over 2. And producer surplus is the same method

[@feast3763]

How pigouvian subsidy is different from pigouvian tax..pls explain??

[@CareyLaManna]

subsidy is gov paying you, a tax is you paying the gov

[@supersonic2778]

Don't need to subsidize the LaMoney market