we extend the urban model to allow for two income groups, a) rich households and poor households, what does the model predict about the relative locations of the two income groups? Use a diagram to illustrate your answer. (10 marks)
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4. If we extend the urban model to allow for two income groups, a) rich households and poor households, what does the model predict about the relative locations of the two income groups? Use a diagram to illustrate your answer. (10 marks)
b) Do these predictions of the urban model match the patterns of segregation we observe in cities? Briefly explain your answer. (10 marks)
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- Some countries rely relatively heavily on taxes that distort economic behavior and others do not. A recent econometric study found that countries in the latter category tend to grow faster than countries in the former (Kneller et al.. 1999). Use the discussion surrounding Figure 15.9 to explain this phenomenon.1.1 Economic models that assume that wages and prices adjust freely to changes in demand and supply are known as............. models.Which one of the following statements about the static linear city model in topic 4 is correct? ( the topic 4 is explained in the images in attachments) A. The firms produce a homogeneous good and make decisons on quantities. B. The firms definitely produce a homogeneous good and make decisions on prices. C. The firms produce horizontally differentiated goods and make decisions on quantities. D. The firms produce horizontally differentiated goods and make decisions on prices.
- In 1989 the Chrysler Corporation released figures showing that its employee health care costs were $5,970 per employee and $700 per vehicle produced. According to the report, its foreign competitors fared much better. Health care costs for automobile companies averaged $375 in France, $337 in Germany, and $246 in Japan, placing Chrysler at a competitive disadvantage. Is there anything wrong with this conclusion? What are the microeconomic arguments and the macroeconomic arguments as they relate to this issue?The development of the internal-combustion engine caused fundamental changes in urban land-use patterns. The transformation from the core-dominated city to the modern suburbanized city took only about 50 years. Given the rapid pace of technological change, it seems likely that some future innovation will cause another transformation of cities. Given your knowledge of science fiction and fact, describe an innovation that would cause fundamental changes in the spatial structure of cities.Suppose that college tuition is eliminated for every admitted student to a public community college or a public 4‑year college or university. a. Such a policy would likely lead to a.a decrease in human capital, conferring a cost b.an increase in human capital, conferring a benefit . b. Such a policy would also lead to a.lower taxes, conferring a benefit b.higher taxes, conferring a cost . c. Such a policy would also lead to a a.rise b.fall in enrollment at private colleges and universities.
- Read the following extract and answer the question? Women’s empowerment movement eyes 40% of government spending accreditation…Last year the South African government affirmed its support for women-owned businesses as part of its commitment to ensuring that gender equality in Africa’s most advanced economy was achieved.President Cyril Ramaphosa said then: “We are going to drive women’s economic inclusion through public procurement. We have set the target of ensuring that 40% of goods and services procured by public entities areprocured from women-owned business.” The above decision by the South African government is an example of…a) Market participation.b) Government spending.c) Commercialisation.d) Nationalisation.Question 1 Imagine we live in a world with two types of skill sets: people with high ability and people with low ability. A diploma will cost a high ability person about 8K and will cost a low ability person about 20K. Businesses use education as a screening tool and they intend to pay 25k to workers without a diploma and $X to those with a diploma. In what range must X be to make this an effective screening tool? Your answer will include a set of equations showing the dollar range for both low ability and high ability people.Following the broad overview of potential costs and benefits of the policy, we will now analyse the main objective of the policy using an economic model. Consider two groups of citizens, each group can either choose to drive x = d or to take public transport x = p. The first group, group 1, enjoys driving and has the following 3 benefit from using their car within the ULEZ area: B1(x1 = d) = 18. The second group, group 2, does not enjoy driving and has a benefit of B2(x2 = d) = 0 from driving their car. If they don’t drive, citizens can use public transport to get around. The benefit of doing so is the same for both groups: B1(x1 = p) = B2(x2 = p) = 10. Both groups drive cars that do not meet the ULEZ requirements and therefore create excessive pollution. For simplicity, we consider that pollution, and the health problems it induces, are the main cost of driving. This cost is imposed on both groups and is equal to Ci(x1 = d,x2 =d)=10ifbothgroupsdrive,Ci(x1 =p,x2 =d)=Ci(x1 =d,x2…
- 1- An example of a poverty trap is a. extended time periods without war b. a lack of mineral wealth c. A corrupt government d. laws and regulations to help detect fiscal fraud 2- Which of the following groups has the highest death rate? a. middle-income economies b. low-income economies c. high-income economies d. All the above economies 3- Models are used to describe cause-and-effect relationships a. True b. FalsePareto efficiency, or Pareto optimality, is an economic state where resources cannot be reallocated to make one individual better off without making at least one individual worse off. Pareto efficiency implies that resources are allocated in the most economically efficient manner, but does not imply equality or fairness. An economy is said to be in a Pareto optimum state when no economic changes can make one individual better off without making at least one other individual worse off.To simplify analysis and discussion the model for general equilibrium uses the two person, two goods and two resources (or 2 X 2 X 2 model). The investigation is done in three steps:• Consumption efficiency • Production efficiency• A combination of Consumption and Production efficiencies. Critically analyze the concept of Pareto efficiency. Use relevant theory and diagrams to support your analysis.While the Lindahl model (equilibrium) can be analogous to the market for private goods, they have interesting differences. How do we interpret Q1 in the diagram? What about S?