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Suppose that demand for a product is Q = 1000 – P and supply is Q = 9P. Furthermore, suppose that the marginal external damage of this product is $20 per unit. Suppose this is a negative production externality.
Calculate the Q currently being produced in the private market.
Calculate the Q that is socially optimal.
Is the market currently over- or under producing this good? By how much?
Calculate the deadweight loss associated with the externality.
while the foreign demand for the firm's product is P = 10 - 2 QF . Given this information, the total demand Q (where Q = QD + QF ) that this firm faces satisfies
Explain how the market for corn would be affected if ethanol, a corn derivative, was used to fuel cars in the united States. How would the market be effected if new technology cause corn farming to be more efficient.
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As Kyle conducts his annual evaluations of his employees, he notices that Connie and Debbie have both been less productive since they were relocated in the same department. Kyle is in what stage of the managerial decision-making process? With communi..
This declaration would perhaps receive general agreement, but it is not always clear exactly Illustrate what concludes when something is in the public interest.
q1. the abc corporation is contemplating purchasing a new computer system that would yield a before-tax return of 30.
Consider a person who can work up to 80 hours each week at a pre-tax wage of $20 per hour but faces a constant 20% payroll tax. Under these conditions, the worker maximizes her utility by choosing to work 50 hours each week. Show that the worker will..
George and John, stranded on an island, use clamshells for money. Last year George caught 300 fish and 5 wild boars. John grew 100 bunches of bananas. In the two-person economy that George and John set up, fish sell for 3 clamshells each, boars sell ..
Consider the market for carbonated water and suppose that demand is given by D(p) = 100 – 5p There are only two firms producing carbonated water, each with the same constant unit cost c = 2. What are the equilibrium prices and quantities if the firms..
Present the arguments for free trade and the arguments for protection of the US domestic steel industry. Analyze and evaluate the arguments. What policy should we follow in the steel industry and why?
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