a. 1. (20 points) A survey was conducted, asking two tenants how much each would be willing to pay each year for an air filter that provides clean air to the apartment complex they rent. The results are given in the following demand equations: Consumer 1: QA = 40 0 4p1 Consumer 2: QA 30 5p2 (5 Points) Explain the inherent characteristics of clean air in an apartment complex. Would these characteristics of clean air lead to market failure? b. (3 Points) Why would you suspect that clean air might generate market failure? C. (4 Points) Find the combined demand for clean air, that is, sum the individual price responses at each quantity. d. (4 Points) The market supply for clean air is: P = 4 +0.75QA. Determine the equilibrium point for this market. e. (4 Points) Using a graph, depict the demand for tenant 1, tenant 2, market demand, market supply and equilibrium point. If there is a kink in the market demand curve, explain the source of this kink. a. 1. (20 points) A survey was conducted, asking two tenants how much each would be willing to pay each year for an air filter that provides clean air to the apartment complex they rent. The results are given in the following demand equations: Consumer 1: QA = 40 0 4p1 Consumer 2: QA 30 5p2 (5 Points) Explain the inherent characteristics of clean air in an apartment complex. Would these characteristics of clean air lead to market failure? b. (3 Points) Why would you suspect that clean air might generate market failure? C. (4 Points) Find the combined demand for clean air, that is, sum the individual price responses at each quantity. d. (4 Points) The market supply for clean air is: P = 4 +0.75QA. Determine the equilibrium point for this market. e. (4 Points) Using a graph, depict the demand for tenant 1, tenant 2, market demand, market supply and equilibrium point. If there is a kink in the market demand curve, explain the source of this kink