Use the following competitive market diagram for product Z to answer the question below. B D1 10 G Quantity Assume that the current market demand and supply curves for Z are D1 and S1. If there are substantial external benefits associated with the production of Z, then Price efficient resource allocation occurs at output G and price B because the market mechanism does not measure all benefits. an output smaller than G would improve resource allocation. the government should levy a per-unit excise tax on to shift the demand curve to the lef an output greater than G would result in a more efficient allocation of resources.

Q: Explain the role of price as a mechanism for allocating resources in an economy.

A: Allocation of resources is based on the demand and supply of a good in the economy. And since there…

Q: On a clean sheet of paper, draw the market described by the following supply and demand functions:…

A: Equilibrium price is the price at which quantity demanded equals quantity supplied and the market…

Q: 1. The First Theorem of Welfare Economics can be expressed as A) the competitive equilibrium results…

A: Welfare economics is a branch of economics that deals with the production and allocation of…

Q: Suppose the government imposes a minimum wage of $15 per hour. True or false? (i) If the inverse…

A: In the mention question, we are given minimum wage and also in the subquestions, we are given the…

Q: incoln offers to do Katelyn's housework for $80 per week. Katelyn's opportunity cost of doing…

A: Opportunity cost is the benefits of next best alternate that is sacrificed.

Q: The graph shown demonstrates a subsidy on buyers. With the subsidy, the producers sell units and…

A: Given diagram Before and after subsidy on the buyer

Q: You have been recently employed as a consultant for a company that produces laptops in Ghana.…

A: “Since you have posted a question with multiple sub-parts, we will solve first three sub-parts for…

Q: In an effort to increase long run supply of output in a market, the government decides to implement…

A: Production theory analyzes how firms recruit and combine factor inputs to produce final goods and…

Q: Answer the questions based on the model given in the image: a. What is the set of Pareto optimal…

A: Given: For individual 1: U1 = X1  + Y1 For individual 2: U2 = min{ X2  , Y2 } X1  = 4 units  Y1 = 8…

Q: pareto efficient allocation should always be on the contract curve . Discuss this sentence

A: Pareto efficiency is a state wherein resources cannot be reallocated in order to make one individual…

Q: Suppose that the supply function for lamb in Australia is Q = 149 + 8p - 9ps , where Q is the…

A: The Supply curve is a graphic representation of the correlation between the cost of a good or…

Q: Consider two separate perfectly competitive markets with downward sloping demand and no…

A: Price ceiling is the mandated maximum price allowed for a commodity.

Q: S S2 Quantity (a) Qe Qo Quantity (b) Price Price

A: The supply and demand curves cross, leading to the equilibrium value and amount. once the number…

Q: Allocative Efficiency associated with competitive equilibrium is a condition where Producer plus…

A: In a competitive equilibrium producers and consumers freely determine the equilibrium price and at…

Q: Suppose the demand curve is given by P=20-Q. Suppose the supply curve is such that the market price…

A: Consumer surplus is the area above the price line and below the demand curve.

Q: Normally, the people of COVID-FREE LAND demand of 3000 sanitizers and 18000 toilet rolls. Suddenly,…

A: Now, the demand for sanitizers and toilet rolls increased to 4,000 and 20,000, respectively. The…

Q: Local government in Victoria has responsibility for garbage collection from households and business…

A: Given information Garbage collection and dispose off creates some negative externality in an…

Q: Normally, the people of COVID-FREE LAND demand of 3,000 sanitizers and 18,000 toilet rolls.…

A: Meaning of Production Possibility Curve or Frontier: The production possibility frontier is a…

Q: Refer to Figure 3-8. The graph in this figure illustrates an initial competitive equilibrium in the…

A: The equilibrium is established where the demand and supply forces are equal. the change in the…

Q: When are Consumer and Producer Surplus at a maximum? A) When a market is in equilibrium B) When…

A: Consumer surplus is an economic gain to the consumer. A consumer gains when the expected price…

Q: Consider a competitive market in which we can analyze the market using our standard demand and…

A: The demand curve shows the association between the amounts of commodity demanded by the consumer at…

Q: Q. Q. Quantity (a) Q. Q0 Quantity (b) Refer to the diagrams for two separate product markets. Assume…

A: A subsidy is an amount that is paid to the producers by the government in order to encourage the…

Q: 2.5 Suppose that the production of goods X and Y is described using the production functions: X =…

A: Given production function For good X X=BLxKx For good Y Y=(2L1/2+2K1/2)X2

Q: Suppose that technological advancements in high-speed rail transport has led some people to…

A: Market demand for a commodity can change as a result of a change in consumers income, their tastes…

Q: Suppose the market demand curve for cranberries is given by the equation Qd = 500 - 4P, while the…

A: The quantity demanded of the good refers to the amount of the good the consumers of the good are…

Q: Price Quantity Demanded Quantity Supplied $10 100 0 $12 80 20 $14 60 40 $16 40 60 $18…

A: The below table shows the market situation at $18.

Q: Suppose the daily demand curve for gasoline is as provided in the accompanying graph. a. Calculate…

A: Consumer surplus is the difference between the maximum willingness to pay and the actual price paid…

Q: Tom's technology is given by the following production function: m = x 1 1 4 4 Y If m represents his…

A: This production function is Cobb-Douglas production function. Now here we are calculating here…

Q: Use the linear demand and supply curves shown below to answer the following questions.You must show…

A:

Q: Three countries engage in the production of flax (an agricultural product). The market for flax in…

A: As the countries are engage in free trade such that the price of the output is common in all the…

Q: Assume that candle wax is traded in a perfectly competitive market in which the demand curve…

A: “Since you have posted a question with multiple sub-parts, we will solve first three subparts for…

Q: Consider the market for pork illustrated in the graph. Suppose initial demand (D') is Q= 290 - 20p…

A:

Q: 5(b) Consider the economy given by W; (1,0) W;- (0,1) U 2x + X22 a. Solve for the set of Pareto…

A:

Q: Suppose supply equation of maize is q = -2+3p a. Derive the equation of the producer surplus (PS)…

A: The supply equation is q=3p-2

Q: Suppose that the price of cricket match tickets at Mirpur stadium is determined by market forces.…

A: The demand and the supply intersection would result in the determination of the equilibrium price…

Q: There are two types of consumers in a market for sheet metal. Let P represent the market price. The…

A: Market demand function: It can be defined as the sum total of the individual demand functions that…

Q: Use the following to answer questions (1) - (14): Suppose the local market for flat glass,…

A: Since we only answer up to 3 sub-parts, we’ll answer the first 3. Please resubmit the question and…

Q: Assume that the resource market is purely competitive. If the price of the resource falls, other…

A: Perfect competition is a structure of market in which there are more number of firm with same goods…

Q: Let’s consider an economy where all firms are favouring remote work to favour physical distancing…

A: Due to pandemic to reduce from spreading remote work is the good option that a firm can offer to…

Q: The Invisible Hand Principle states that individuals' independent efforts to maximize their gains…

A: Since you have posted multiple question, so as per answering guideline, First question will be…

Q: General Equilibrium 1 Consider, U1(21, y1) = 2(x11)* + 20 U2(2, Y2) = 10lnx2 + 4lny2 W1 (2, 1) and…

A: Given information U1(X1Y1)=2(X1Y1)4+20 U2(X2Y2)=10lnX2+4lnY2 Initial endowment W1 =(2,1) W2=(1,2)

Q: Since 1996, market prices for helium have seen consistent increases based on high demand in the…

A: It is possible to buy or sell an asset or service at the current market price—the dynamics of supply…

Q: Suppose that the price of sedans in the previous graph decreases from $25,000 to $20,000 per car.…

A: According to the Law of demand and supply, greater quantities of a commodity are supplied at higher…