Reference no: EM13157795
Question 1: The fumes from dry cleaners can contribute to air pollution. Suppose the following graph illustrates the situation in the dry cleaning market.
a. Explain how a government can use a tax on dry cleaning to bring about the efficient level of production. What should the value of the tax be?
b. How large is the deadweight loss (in dollars) from excessive dry cleaning, according to the figure?
Question 2: Negative externalities can exist in consumption. Writing in the New England Journal of Medicine, Kelly Brownell of Yale and Thomas Frieden, health commissioner of New York City, argue that consuming sugar-sweetened soft drinks involves a significant externality.
They argue that this externality exists because consuming soft drinks can lead to medical problems whose treatment is paid for partly by tax-payers through the government Medicare and Medicaid programs, and because these medical problems can also reduce school performance and work productivity.
a. Assuming that this analysis is correct, use a graph to illustrate the externality in the market for sugar-sweetened soft drinks. Be sure to label on your graph the points representing the market equilibrium and the efficient equilibrium.
b. If the government decides to tax soft drinks to deal with the externality, is it likely to require firms producing soft drinks to pay the tax or consumers of soft drinks to pay the tax? Assuming that the government can collect the tax as easily from consumers as from firms, will it matter which group pays the tax? Illustrate your answer with a graph showing the effect of the tax if consumers are required to pay it and the effect of the tax if firms are required to pay it.
Question 3: Why does the government subsidize the purchase of college educations but not the purchase of hamburgers?
Question 4: Suppose that Jill and Joe are the only two people in the small town of Andover. Andover has land available to build a park of no more than 9 acres. Jill and Joe's demand schedules for the park are as follows:
a. Draw a graph showing the optimal size of the park. Be sure to label the curves on the graph.
b. Briefly explain why a park of 2 acres is not optimal
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Determine whether the mechanism is valid for reaction
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Define the equilibrium for this environment
: Define the equilibrium for this environment. Solve for the equilibrium you defined in part. Perform a cost benefit analysis for the project defined in part.
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State how many moles of ammonia are produced
: how many moles of ammonia are produced? How many moles of H2 remain? How many Moles of N2 remain? What is the limiting reactant?
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Draw a graph showing the optimal size of the park
: Draw a graph showing the optimal size of the park and briefly explain why a park of 2 acres is not optimal
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Berger was planning to produce a fashion show
: Berger was planning to produce a fashion show in Las Vegas. In April 1965, Berger entered into a written licensing agreement with CBS Films, Inc., a wholly owned subsidiary of CBS, for a presentation of the show. In 1966, Steward Cowley decided to pr..
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A solution is prepared by dissolving unknown nonelectrolyte
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