Macroeconomics, Student Value Edition (6th Edition)
Macroeconomics, Student Value Edition (6th Edition)
6th Edition
ISBN: 9780134126081
Author: R. Glenn Hubbard, Anthony Patrick O'Brien
Publisher: PEARSON
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Chapter 7, Problem 7.3.13PA
To determine

Location of the industry and external economies.

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Graphically depict the market for hogs in China, assuming that the demand curve slopes down and the supply curve slopes up. This is purely an analysis of the impact of African swine fever. It is true that trade wars between the U.S. and China are significant, but for this analysis, we are just looking for the impact of the deadly swine fever independent of any other external shocks to the Chinese pork production industry.
Jessica Alba, a famous actress, starts the baby and family products business, The Honest Company, with Christopher Gavigan. Alba and Gavigan set up their site so families can choose what kinds of non-toxic, all-natural products they'd like to use and get them in a bundle. Families can choose all kinds of products from food to hygiene necessities and cleaning supplies. Suppose they are thinking of expanding their business into five domestic markets: Phoenix, Dallas, Chicago, New York, and Atlanta. Assume their primary goal of business is to maximize economic profits, although they want to do business honestly.Show all your calculations and process. Describe your answer for each question in three- to five-complete sentences. You are a business adviser for Alba and Gavigan. Describe a skimming price and a penetration price, and advise them whether they should charge a skimming price or a penetration price, with supportive reasoning for and against each pricing alternative. Are they…
The following table gives recent figures for yield per acre in Illinois and Kansas : Illinois: WHEAT 48       SOYBEANS 39  Kansas: WHEAT40    SOYBEANS 24 If we assume that farmers in Illinois and Kansas use the same amount of labor , capital , and fertilizer , which state has an absolute advantage in wheat production ? soybean production ? If we transfer land out of wheat into soybeans , how many bushels of wheat do we give up in Illinois per additional bushel of soybeans produced in Kansas ? Which state has a comparative advantage in wheat produc tion ? in soybean production ? The following table gives the distribution of land planted for each state in millions of acres in the same year . Illinois TOTAL ACRES UNDER TILL 22.9               WHEAT 1.9 ( 8.3 % )               SOYBEANS 9.1 ( 39.7 % ) Kansas TOTAL ACRES UNDER TILL 20.7               WHEAT 11.8 ( 57.0 % )               SOYBEANS1.9 ( 9.2 % ) 5. Are these data consistent with your answer to part 3 ? Explain .
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