Consider product X with industry supply given by p = 4 + 2q, and industry demand given by p = 20 - 2q. If the government sets a cap on production in this industry of 2, what is the deadweight loss?
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CS 7
Economics
Consider product X with industry supply given by p = 4 + 2q, and industry
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- Given the supply - demand function of printers in Vietnam as follows:Sx = -20000 + 250PDx = 160000-350PKnowing that Vietnam is considered a small country, the price of a printer on the world market is $120/piece.a. If the Government of Vietnam levies an import tax of 25% on this item, calculate the loss to domestic consumers. How much is the import tax revenue from the Vietnamese government's printer products in this case?b. Due to the commitment to integration, the Government of Vietnam applies an import tax rate of 12.5% for printers, calculate the change in the import tax revenue of the Government of Vietnam.c. To ensure that there are no more imports, what is the minimum tax rate that the Vietnamese government should set?1) The following table displays the marginal costs (MC) of Les, the sole producer in the market, and the marginal benefits (MB) of Eddie, the sole consumer in the market: Quantity of Guitars MC of Les MB of Eddie 1 800 2700 2 1000 2200 3 1200 1800 4 1500 1500 5 1800 1200 6 2200 1000 7 2700 800 Assume now that Leo, the minister of guitars, sets a price floor at $1800. What is the market deadweight loss? $ __________13. You just got a patent for the first commercial self-driving car. The following table shows the elasticity of the demand and the marginal cost of production of your cars in several production centers across the globe. Assuming that this are constant, can you approximate what would be the optimal price for your cars? City Marginal Cost Elasticity Price Wolfburg, Germany Barcelona, Spain Tokyo, Japan Ulsan, South Korea East London, South Africa Mexico City, Mexico $20, 000 $18, 000 $22, 000 $16, 000 $10, 000 $12, 000 -1.5 $60, 000.00 $24, 000.00 $33, 000.00 $32, 000.00 $11, 428.60 $14, 400.00 -4.0 -3.0 -2.0 -8.0 -6.0
- A large share of the world supply of cocoa beans comes from Ghana and Ivory Coast. Suppose that the marginal cost of producing cocoa beans is constant at GHC1000 per bag and the demand for cocoa beans is described by the following schedule. Price (GHC) Quantity (bags) 5000 6000 7000 8000 9000 10000 11000 12000 8000 7000 6000 5000 4000 3000 2000 1000 a) If there were many suppliers of cocoa beans, what would be the price and quantity? b) If there were only one supplier of cocoa, what would be the price and quantity? c) At a meeting in October 2017 in Accra, the leaders of the two leading producers of cocoa beans discussed the possibility of cooperating to boost the price of cocoa. If Ghana and Ivory Coast formed a cartel, what would be the price and quantity? If the countries split the market evenly, what would be Ghana's production and profit? f) What would happen to Ghana's profit if it increased its production by 1000 cocoa while Ivory Coast stuck to the cartel agreement? g) Use your…Suppose that the figure given below depicts the demand for grape oll, which can be purchased in any quantities and sold at any price. Price per litre 6 5 A 3 2 1 0 D 100 200 300 400 500 600 700 800 900 1000 Quantity per period a) What is the total consumer surplus if the price per litre is $3.0? (Hint: Area of a triangle?) Total consumer surplus: $ b) What is the total consumer surplus if the price per litre is $1.0? Total consumer surplus: $1. The President of Riceland is very fond of rice and hence has given the license to produce rice only to her own nephew, Mr. Brown. Even the international trade in rice is not allowed. Following is the demand that Mr. Brown faces for rice: D=10-P. He faces a total cost, given by C = 3+Q+0.5Q². People of Riceland were revolting against this obsession for rice for their President, which, one day, eventually resulted in opening up of trade in rice, at the competitive world price level of 3 $. However, the obsession of rice for the President forced her to limit the amount of rice traded in the market to one unit, and she gave the license to trade to Mr. Brown only. Discuss the pattern of trade in rice for Riceland under free trade and restricted trade situations. Compare the profits/losses of Mr. Brown under the following four conditions and which will be the best scenario that he would like the President of Riceland to go for: (a) No trade situation; (b) Free trade situation; (c)…
- Suppose five construction companies have the ability to build a factory overseas to produce a manufactured good The marginal cost of building a factory for each construction company is shown in the table below: Producer Company 1 Company 2 Company 3 Company 4 Company 5 Marginal Cost S1,000,000 $1.250,000 $1,300,000 $1,350.000 $1.500.000 If the market price of an overseas factory is $1.425,000, what is the surplus for these five companies? Producer surplus is S (Enter your response an a whole numberTrue or False, Explain Why 1. A production function is characterized by ? = 10 + 5L, where q is output per hour and L is labor input per hour. If workers earn $10 per hour, the marginal cost of the 5th unit of output is $10. 2. The producers’ surplus in the short-run reflects what the firms gain, while the producers ‘surplus in the log-run reflects what the input owners gain. 3. A monopoly is a price maker, thus its price can never be equal to its marginal revenue. 4. For a monopolistic competitive firm, if a government imposes a lump-sum tax on a firm, the policy will never affect its profit maximizing output and price.1. The market demand function of a perfectly competitive market is Q=500-p, and the cost function of an individual company is C(q)=q^3-20q^2+110q. Suppose that the government imposes a tax of 10 per unit of transaction on companies. In the long-term equilibrium, find K-L when you indicate the number of companies as L and the market price as K. Find W1 - W2, W1 is when no tax is imposed, and W2 is when the government imposes a tax of 10 per unit of transaction on an enterprise.
- For years the governments of the European union have subsidized the production of Airbus planes.Boeing and Airbus are fierce competitors .show graphically and explain how the European subsidies have affected for Boeing planes.1. Suppose the inverse demand for a product produced by a single firm is given by P = 100 - 10Q and the firm has a marginal cost of production of MC = 10 + 10Q. a. If the firm cannot price discriminate, what is the profit-maximizing price and level of output? b. If the firm cannot price discriminate, what are the levels of producer and consumer surplus in the market? What is the deadweight loss? c. If the firm is able to practice perfect price discrimination, what output level would it choose? What are the levels of producer and consumer surplus and deadweight loss under perfect price discrimination?How can GM maintain control of its production in the China market?