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Problem
Figure 18P-4 shows supply and demand for first-aid training, based on private costs and benefits.
a. Suppose that the external benefit from first-aid training is worth $6. Graph the demand curve for first-aid training based on the social benefits.
b. How many hours of first-aid training will occur?
c. What is the socially optimal quantity of first-aid training?
d. How much surplus is lost when consumers are unable to capture the $6 external benefit they provide from first-aid training?
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