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If no trade occurs between the markets, what are the equilibrium values of D1, S1, P1, D2, S2, and P2? Solve algebraically
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- ###PLEASE CHECK IMAGE FOR CORRECT EQUATION In class, we estimated the per-capita demand function for watermelons (in natural logs) to be????? = ―3.7 ― 1.02???? + 1.6????? ― 0.75?????where P is the price of watermelon ?? is per capita income, and ?? is the freight price. Suppose the natural log of the supply curve is given by ????? = 1.2 + 0.6????.Please answer both of these: 1) What is the cross-price elasticity of freight and what does it say about whether freight is a complement or substitute? What is the income elasticity of watermelon demand and what does it say about whether watermelon is an inferior versus normal or luxury good? 2) Hold the per capita income and freight prices equal to their sample means: 800 and 16, respectively. What is the equilibrium price and quantity?onsider the supply function: Qs = 60 + 5P – 12 PI + 10F , Where Qs = quantity supplied, P = price of the commodity, PI = price of a key input in the production process, and F = number of firms producing the commodity. Interpret the slope parameters on P, PI, and F. Derive the equation for the supply function when PI =$90 and F = 20. Sketch a graph of the supply function in part b. At what price does the supply curve intersect the price axis? Give an interpretation of the price intercept of this supply curve. Using the supply function from part b, calculate the quantity supplied when the price of the commodity is $300 and $500. Derive the inverse of the supply function in part b. using the inverse supply function; calculate the supply price for 680 units of the commodity. Give an interpretation of the supply price.Assume the Supply of Kidneys is expressed as: Qs = 800 +.2P Assume the Demand for Kidneys is expressed as: Qd = 16,000 - .2P Due to the 1984 act prohibiting the purchase and sale of organs for transplant, supply will be limited to the number of kidneys individuals will donate (the number of kidneys donated when the price = 0) Graphically, show the supply and demand for kidneys before prohibition. Solve algebraically for the equilibrium price and quantity. How many kidneys will be available for transparent given the prohibition of selling a kidney in the market? Draw in what the new supply curve will look like. Will a shortage or surplus of kidneys result? What happens to the opportunity cost of acquiring a kidney?
- Consider the following model of the factors that influence a person's annual wage: Y = β0 + β1X1 + β2X2 + β3X1X2 + β4X3 + u where Y = annual wage, in dollars X1= years of formal education X2 = age, in years X3 = variable equal to 1 if male, 0 otherwise U = error term Which of the following is the interpretation of β1 alone? The effect of X1 on Y when X2 = 0 The effect of X1 on Y when X2 is at its median value. The effect of X1 on Y, holding all else equal. The effect of X1 on Y when X2 is at its mean value.Consider the market for copper, where demand is given by the equation P(QD) = 500 - 1/2Q and market supply is given by P(Qs) = 50 + Q. The discount rate is r=10% and there is a fixed supply of 400 total units of copper. a. If there is just one period in this model, what would be the equilibrium market price and quantity sold? Show your work. Is the resource exhausted? b. Suppose instead that there are two periods, and that demand and supply are the same in both periods. Derive an expression for the marginal net benefit (MNB) of the resource in each period. c. Find the optimal allocation of copper between the two periods, and using the demand curves, find the price that would prevail in each period. d. How do your answers in part (c) change if the discount rate increases to 25%?Consider the general supply function: Qs=60+5p-12Pl+10F Where Qs = quantity supplied, p = price of the commodity, pl = price of a key input in the production process, and F = number of firms producing the commodity. 1. Interpret the slope parameters on p, pl, ane F. 2. Derive the equation for the supply function when pI = $90 and F = 20. 3. Sketch the graph of the supply function in part b. At what price does the supply curve intersect the price axis? Give an interpretation of the price intercept of this supply curve. 4. Using the supply function from part b, calculate the quantity supplied when the price of the commodity is $300 and $500.
- At a unit price of $340, the quantity demanded of a certain commodity is 80 pounds. If the unit price increases to $560, the quantity demanded decreases by 22 pounds. Find the demand equation (assuming it is linear) where p is the unit price and x is the quantity demanded for this commodity in pounds. p= At what price are no consumers willing to buy this commodity? According to the above model, how many pounds of this commodity would consumers take if it was free?Data in 1970-1999 suggest that wine consumption per capita in the State of New York is: %∆Wine = – 0.7*(%∆Price of Wine) + 3.8*(%∆Income) + 1.0*(%∆Price of Beer) where Wine is a gallon of wine per capita, Price of Wine and Price of Beer are prices of wine and beer, respectively, and Income is the nominal income per capita. All variables are expressed as percentage changes year-over-year, which are denoted as %∆ in the above equation. Explain the demand behavior of wine drinkers in New York. Does the behavior of New York consumers follow the law of demand? Why or why not? In 2003, the New York government was considering allowing supermarkets to sell wines. Lobbyists argue that the proposed law would help the local governments to balance their budgets. The argument is that the wine prices will fall, people will buy more wines, and consequently, local governments have more tax revenues. Giving the above-estimated demand function, do you support their argument? In addition, the…DVANCED ANALYSIS Assume that demand for a commodity is represented by the equation P=80−2Qd.�=80−2��.Supply is represented by the equation P=−20+2Qs,�=−20+2��,where Qd and Qs are quantity demanded and quantity supplied, respectively, and P is price.Instructions: Round your answer for price to 2 decimal places and enter your answer for quantity as a whole number. Using the equilibrium condition Qs = Qd, solve the equations to determine equilibrium price and equilibrium quantity. Equilibrium price = $ Equilibrium quantity = units
- TRUE or FALSE 25. Healthcare, sanitation, education, and independence of women are considered parts of the demographic transition of a nation. 26. The demand for children equation posits that the demand for surviving children is directly related to the net price of children but is indirectly related to the taste for goods relative to children. 27. Fertility rate is measured from a women's perspective so does the mortality rate.Assume in a two-sector economy made up of agriculture and manufacturing, the government introduces a subsidy of y per hour on labour in the manufacturing sector. What will be the effect of the policy on the equilibrium wage, total employment as well as employment in agriculture and manufacturing?Choose the right answers. (A) The infant mortality rate Measures the proportion of children who died between O and 1 year, inclusive. (B) The infant mortality rate Measures the proportion of children who have died and are less than one year old. O C) The infant mortality rate is the percentage of children who have died and are under one year of age (D) The infant mortality rate measures the proportion of children under the age of 5. 2) true or false The gross mortality rate in a country is always consistent with life expectancy in that country.