Reference no: EM131002539
In an effort to protect domestic olive oil producers from international competition, the French government is considering the introduction of an olive oil subsidy. Currently, in France the yearly demand for olive oil is Qd = 600 – 20P and the yearly supply of olive oil is Qs =40P-240. Quantity is measured in millions of liters and price in dollars per liter.
A. In a diagram, sketch the demand curve and the supply curves and clearly mark the market equilibrium price and quantity.
B. Using algebra, compute equilibrium price and equilibrium quantity.
The French government is considering paying oil producers $6 per litre of olive oil sold. If implemented, the subsidy shifts the supply curve down by $6 at every quantity.
C. In the diagram, illustrate the influence of the olive oil subsidy on the market equilibrium price and the market equilibrium quantity. D. Who would benefit the most from the olive oil subsidy, consumers or producers? Justify your answer.
E. After the subsidy is implemented, does the olive oil industry produce the socially optimal quantity of olive oil? Briefly explain.
F. Suppose the supply of olive oil was less price elastic. Would the olive oil subsidy create a larger or a smaller deadweight loss? Justify your answer.
|
Appropriate expressions for obtaining actual pdf parameters
: For each of the following distributions, given the population mean μ, and variance σ2 , derive the appropriate expressions for obtaining the actual pdf parameters (α, β, or n, p) in terms of μ and σ2: (i) Gamma(α, β); (ii) Beta(α, β); (iii) Binomi..
|
|
What pension and other postretirement benefit plans
: FedEx reports three actuarial assumptions used in its pension calculations. Did reported changes in those assumptions from the previous year increase or decrease the projected benefit obligation? Why?
|
|
What is the distance from the slit to the screen
: Monochromatic light (wavelength = 466 nm) is incident perpendicularly on a single slit (width = 0.52 mm). A screen is placed parallel to the slit plane, and on it the distance between the two minima on either side of the central maximum is 2.1 mm...
|
|
Describe the strategy of the customer experience
: Since the establishment of Hard Rock Café in 1971, describe the strategy of "The Customer Experience" in the global environment. How has Hard Rock Café marketed, produced, and financed their goods and services to meet the current strategies
|
|
Compute equilibrium price and equilibrium quantity
: In an effort to protect domestic olive oil producers from international competition, the French government is considering the introduction of an olive oil subsidy. In a diagram, sketch the demand curve and the supply curves and clearly mark the marke..
|
|
Indicated changes in the population
: From an appropriate statistical description of these data sets, comment on the indicated changes in the population in the two decades between 1960 and 1980.
|
|
Renewable fuels like ethanol be blended into gasoline
: Ethanol or ethyl alcohol is a motor fuel produced from sugarcane, corn or other sugar based feedstocks. In the United States, where ethanol production uses corn as feedstock, the Energy Policy Act requires that a minimum quantity of renewable fuels l..
|
|
What is zynga goal
: What is Zynga's goal? How will that goal affect the way strategies are pursued? Try to be as specific as possible. How do you build a viable business getting people "to buy a bunch of things that don't exist
|
|
What was the light rays wavelength when it was in diamond
: A monochromatic ray of light is refracted by an angle of 72.0 degrees as it enters ice(1.31) from a piece of diamond(2.42), if the frequency of the light Ray is 2.96x10^4 cycles/second when it is in ice, then what was the light rays wavelength wh..
|