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using economic reasoning, why are masks important?
Why will the market fail to yield efficient outcome during the pandemic?
Given current situation of covid-19 discuss the pros and cons of imposing a
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- Using economic reasoning, why are wearing masks important during this COVID 19 pandemicThe local space museum has hired you to assist them in setting admission prices. The museum’s managers recognize that there are two distinct demand curves for admission. One demand curve applies to people ages 12 to 64, whereas the other is for children and senior citizens. The two demand curves are: PA = 9.6 – 0.08QA PCS = 4 – 0.05QCS, where PA is the adult price, PCS is the child/senior citizen price, QA is the adult quantity, and QCS is the child/senior citizen quantity. Crowding is not a problem at the museum, so managers consider marginal cost to be zero. a. What price should they charge to each group to maximize profits? b. How many adults will visit the museum? How many children and senior citizens? c. What are the museum’s profits?Elizabeth Airlines (EA) flies only one route: Chicago-Honolulu. The demand by business people for each flight is QA = 260 – 0.4P while the demand for students for each flight is QB = 240 - 0.6P. EA’s cost of running each flight is $30,000 plus $100 per passenger. The airline is able to perfectly distinguish students from business people. Which of the following statements is true? Note the demand equations must be rewritten as inverse demand equations to solve this problem. A. The profict maxmizing quantity sold to students is 110 and the profit maximizing price charged to students is $375. B. The profict maxmizing quantity sold to students is 90 and the profit maximizing price charged to students is $375. C. The profict maxmizing quantity sold to students is 110 and the profit maximizing price charged to students is $250. D. The profict maxmizing quantity sold to students is 90 and the profit maximizing price charged to students is $250.
- Use economic reasoning as to why the market would fail to yield the efficient outcome of price gouging of face maskPrice discrimination is a quite common phenomenon in a market economy. Choose any FOUR (4) price discrimination strategies and explain how producers of hand-sanitizers can implement the strategies during the COVID-19 pandemic.Two identical firms save money from polluting. A firm’s marginal savings from emitting an amount e are given by 10 − 2e. The two firms differ in their impact on ambient pollution concentrations. Two units of emissions from firm 1 result in one unit of ambient pollution, while one unit of emissions from firm 2 results in one unit of ambient pollution. a) Initially the policy-maker decides to institute a standard cap and trade program instead of regulating ambient pollution. If each firm is initially given three emission permits, how many permits will each firm end up with and what will be the price? b) The policy-maker realizes the differences between the firms and de- cides to institute ambient pollution permit trading. What are the transfer coefficients for each of the firms? If instead each firm is given two ambient pollution permits and trading takes place, how much will each firm end up emitting, and what will be the price?
- A group of researchers has estimated the marginal social benefits of improvements in soil fertility per acre to be: P = -1.25Q +20 The government is considering options for supporting farmers to improve soil fertility. The government can set a fee of either $7.50, $5, $2.00 or $0 on nitrogen fertilizers. The marginal cost of providing the program is constant at $5 per acre. • What is consumer surplus under each of the government pricing options? • What is the government revenue under each pricing scenario? • What is the cost to the government under each pricing scenario? • What is the government (producer) surplus under each of the pricing options? • What options maximize total social benefits? Explain your answer.using economic reasoning why would a market fail to yield the efficient outcome for the gouging price of masks?From an economic perspective, is it sound policy to pursue a goal of zero pollution? Why or why not? Can extreme levels of pollution hurt the economic development of a high-income country? Why or why not? How can high-income countries benefit from covering much of the cost of reducing pollution created by low-income countries? The table below shows the supply and demand conditions for a firm that will play trumpets on the streets when requested. Qs1 is the quantity supplied without social costs. Qs2 is the quantity supplied with social costs. How does accounting for the externality affect the equilibrium price and quantity?
- As the manager of a monopoly, you face potential government regulation. Your inverse demand is P = 50 - 1Q, and your costs are C(Q) = 18Q.a. Determine the monopoly price and output.Monopoly price: $___ Monopoly output units____b. Determine the socially efficient price and output.Socially efficient price: $____ Socially efficient output Units___c. What is the maximum amount your firm should be willing to spend on lobbying efforts to prevent the price from being regulated at the socially optimal level?$____There are many possible ways to limit the number of cabs in a city. The most common method is an explicit quota using a medallion that is kept forever and can be resold. One alternative is to charge a high license fee each year, which is equivalent to the city’s issuing a medallion or license that lasts only a year. A third option is to charge a daily tax on taxicabs. Using figures, compare and contrast the equilibrium under each of these approaches. Discuss who wins and who loses from each plan, considering consumers, drivers, the city, and (if relevant) medallion owners.Please, write a 10 sentence (maximum) essay on how you could use the Herfindahl-Hirschman index to analyze changes in market concentration in your chosen industry/market (what data would you collect, how would you use the data to draw conclusions about market concentration).
