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Analyse the economic implications of "rent-seeking" with the aid of a diagram
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- What are two unintended consequences of a rent ceiling, other than the obvious shortage of apartments?The following graph represents the demand and supply for blinkies (an imaginary product). The black point (plus symbol) indicates the pre-tax equilibrium. Suppose the government has just decided to impose a tax on this market; the grey points (star symbol) indicate the after-tax scenario. PRICE (Dollars per blinkie) 64.00 48.00 32.00 Demand A B D F 20 C E 40, 48 40 Supply QUANTITY (Blinkies) ?The Australian government have suggested that they might need to increase GST to help fund the COVID-19 rescue package. GST is a tax on goods and services usually paid at the point of sale. Consider the market for bread. Suppose a loaf costs $4.15 and includes a 15-cent tax per loaf. 2. What determines how the tax burden is shared between buyers and sellers?
- Identify and briefly explain 2 advantages and 2 disadvantages of government legislated rent control. (I.E. A price ceiling)Select the correct answer. When looking at rent control a price ceiling typically impacts: Group of answer choices both supply and demand supply demand neitherSuppose the California legislature passed a sweeping law to lower the number of regulations for building homes such as decreasing the parking requirements and setback requirements. Suppose there is a housing tax. What is the effect of this law on the PES for housing? What effect would this law have on the tax burden for buyers?
- Suppose the California legislature passed a sweeping law to lower the number of regulations for building homes such as increasing the parking requirements and setback requirements. Suppose there is a housing tax. What is the effect of this law on the PES for housing? What effect would this law have on the tax burden for buyers?The market demand and supply for renting apartments in the Midrand area is given as: Demand: p = 12 000 - 5Qd Supply: p = 800 + 3Qs 5. What is the landlord’s total revenue at the equilibrium price? [1] R7 000 000.[2] R12 000 000.[3] R8 000 000.[4] R1 400 000. 6. If the government implements an effective rent ceiling of R4 100 in the Midrand area, what are the search costs? [1] R0.[2] 2 640 000.[3] 1 320 000.[4] 72 000. 7. What price will the customers be willing to pay on the black market? [1] R5 000.[2] R4 100.[3] R6 500.[4] R1 400.Distinguish between market failure and government failure. Does rent-seeking behavior occur only as a result of government failure? Explain your answer.
- Assume the government imposes an effective minimum wage (i.e., one above the equilibrium wage rate that would otherwise prevail in that market). What does our supply and demand analysis implie?Continuos income streams(total value, present value,future value) Consumers surplus and producers surplus A national study of U.S. colleges results in a demand equation q=20000-2p where q is the enrollment at a public college or university and p is the average annual tuition (plus fees) it charges. Officials at ESU have developed a policy to guide the number of students it will accept at a tuition level of p dollars. It is summarized in the equation q=7,500=0.5p. find the quilibruim tuition price p. find the consumers surplus for price p. find the producers surplus for pruce p. Find the total social gain.Rubber for erasers is produced in the market. There are equations for the Supply and Inverse Demand of eraser rubber that model its Supply and Demand graph. These equations are (for supply), P = 20 + Qs, and (for Inverse Demand), P = 80 - Qd. With that said, the government realizes that it is not turning out enough revenue from the market. As a result, it places a per-unit sales tax of $10. (Part I) Draw the market equilibrium with the government intervention (Q**, PD**, and PS**) of the sales tax. Please label the graph for slopes, equilibrium points, sales tax, etc. (Part II) What is the market equilibrium without the intervention of the government? (Part III) The government once again realizes that the previous tax was not sufficient, and the government is still not making enough money. So, it increases the sales from $10 to $20. Consequently, what is the new market equilibrium point (Q**, PD**, and PS**) with this new intervention? It is not necessary to label this point on the…