Foundations of Economics (8th Edition)
8th Edition
ISBN: 9780134486819
Author: Robin Bade, Michael Parkin
Publisher: PEARSON
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Chapter 11, Problem 9IAPA
To determine
To explain:
The way the Pacific islands' action influences the efficiency of use of Tuna resources.
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The following data refers to the number of logging operations working in a stretch of tropical rainforest per week. Excluding externalities, the private cost of a logging operation is $25 thousand per week. Logs sell for $1 a piece. Fill in the chart below.
# of operations
total harvest
average harvest
average revenue
marginal harvest
marginal revenue
marginal profit
0
0
1
40
2
75
3
105
4
130
5
150
6
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8
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What is the number of logging operations in the forest that maximizes total profit? How much total resource rent is generated at this level of harvest?
With open access to the forest, how many folks will wind up logging? With open access, will there be any resource rent earned by the loggers?
Suppose the total externalities associated with deforestation could be valued at $10,000 per operation. What is the efficient number of operators? What is the open…
1. Brazilian rain forests reduce global air pollution and support biodiversity. Rain forests are being cut down to support expanded production of beef for export to the US and other countries.
1. Concisely describe the market failure that leads Brazil to reduce the size of its rain forest.
2.Graph the market for beef in the US showing both the unregulated and efficient outcome.
3.In the efficient market, the negative externalities of deforestation are factored into the market price, which leads to a lower quantity of beef produced (Q2) and a higher price (P2) than in the unregulated market.
4.Explain how a tax on beef in the US would impact the price and quantity of beef and the quantity of air pollution. Graph the market for beef with a tax and discuss if/how efficiency changes after the tax.
5.A second proposal is to subsidize the development of meat substitutes (e.g. Beyond Beef, Impossible Meat, etc). Graph the impact of the entry of meat substitutes on the market for…
9. Market efficiency and market failure
Suppose that the following graph shows a free market equilibrium, with QEQE as the equilibrium quantity.
Chapter 11 Solutions
Foundations of Economics (8th Edition)
Ch. 11 - Prob. 1SPPACh. 11 - Prob. 2SPPACh. 11 - Prob. 3SPPACh. 11 - Prob. 4SPPACh. 11 - Prob. 5SPPACh. 11 - Prob. 6SPPACh. 11 - Prob. 7SPPACh. 11 - Prob. 8SPPACh. 11 - Prob. 9SPPACh. 11 - Prob. 10SPPA
Ch. 11 - Prob. 1IAPACh. 11 - Prob. 2IAPACh. 11 - Prob. 3IAPACh. 11 - Prob. 4IAPACh. 11 - Prob. 5IAPACh. 11 - Prob. 6IAPACh. 11 - Prob. 7IAPACh. 11 - Prob. 8IAPACh. 11 - Prob. 9IAPACh. 11 - Prob. 1MCQCh. 11 - Prob. 2MCQCh. 11 - Prob. 3MCQCh. 11 - Prob. 4MCQCh. 11 - A renewable common resource is used sustainably if...Ch. 11 - Prob. 6MCQCh. 11 - Prob. 7MCQCh. 11 - When ITQs are assigned, the market price of an ITQ...
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