User Account

All Pages

What is the highest price a vendor would pay for a permit

Assignment Help Macroeconomics
Reference no: EM131907830

1) The city that has a number of hot dog food trucks operating throughout the downtown area. Suppose that each food truck has a marginal cost of $1.50 per meal sold and no fixed cost. Suppose the maximum that any food truck can sell is always 100 meals per day.

(a) If the price of a meal is $2, how many meals does each vendor want to sell?

(b) If the industry is perfectly competitive, will the price remain at $2 for a hot dog? If not,what will the price be?

(c) If each vendor sells exactly 100 meals a day for $2 each, and the demand for meals from food trucks in the city is Q = 4400-1200P, how many food trucks are there? Is this the same number of food trucks that will exist in the long run? If yes, explain why. If not, how many would there be?

(d) Suppose the city decides to regulate food trucks by issuing permits. If the city issues only 20 permits and if food truck continues to sell 100 meals a day, what price will a meal sell for?

(e) Suppose the city decides to sell the permits and we are still in the short run equilibrium where the price is $2. What is the highest price a vendor would pay for a permit?

Reference no: EM131907830

Questions Cloud

Discuss the stationarity of your time series data : MM905: Project on Modelling Financial Data. Discuss the stationarity of your time series data. Transform the data into log-returns. Make time plots
Considering the purchase of new industrial washer : Bottoms Up Diaper Service is considering the purchase of a new industrial washer.
The couple is considering re-financing mortgage : The couple has made all payments over the last 10 years. Currently, the couple is considering re-financing their mortgage.
Assuming straight line depreciation method : BlackShark Inc. invested $220,000 in a new machine. The machine is expected to last 5 years (assuming a straight line depreciation method).
What is the highest price a vendor would pay for a permit : Suppose the city decides to sell the permits and we are still in the short run equilibrium where the price is $2. What is the highest price a vendor would pay
Consumer surplus at the competitive equilibrium : If market supply is given by p = q/8 , what is consumer surplus at the competitive equilibrium?
Find the weighted average cost of debt for company : Find the weighted average cost of debt for a company with the following two bonds outstanding:
Calculate the marginal cost of providing additional assistan : It pays an accountant $100,000 and a tax preparer $50,000. Calculate the marginal cost of providing additional assistance.
What are the costs of inflation : High rate of inflation is considered bad for the economy since it has various costs. What are the costs of inflation?

Reviews

Write a Review

Macroeconomics Questions & Answers

  Inflation targeting be a good policy

Why might it be difficult for the Fed to formally adopt inflation targeting?  Would inflation targeting be a good policy for the Fed in the present economic environment

  In using the taylor rule

In using the Taylor Rule as a guideline for monetary policy, what are the pros and cons of using forecasted values of inflation and output rather than observed values of these variables?

  Describe the present economic crisis situation in europe

Describe the present economic crisis situation in Europe.  Why has it been so difficult for the Europeans to find a solution to this problem?   Comment on what implications the crisis may have for the rest of the world if Europeans are not able to ag..

  Long-term federal government budget problems

Question:. Explain why there are long-term Federal government budget problems. Explain why the base-line forecast of the CBO is misleading.

  Derive and compare demand curve

Question based on Derive and compare demand curve,  Derive Ambrose's demand function for peanuts. How does it compare with Johnny's demand curve for peanuts?

  Problem based on utility function

Problem based on  Utility Function - Problem,  Answer and explain the following using a diagram which is completely labeled.

  Laffer curve : tax rate and tax revenue

Question based on Laffer Curve : Tax Rate and Tax Revenue,  Do raising tax rates necessarily raise tax revenue? What factors affect how tax revenue changes when tax rates change?

  Problem - income elasticity of demand

Problem - Income Elasticity of Demand,  Interpret the following Income Elasticities of Demand (YED) values for the following and state if the good is normal or inferior; YED= +0.5 and YED= -2.5

  Positive balance of payment

Question Positive Balance of Payment: "Things will look good for the US if we could just get to where we are consistently running a positive Balance of Payments."

  Effect of recession on the investment curve

Comment on the effect of a recession on the investment curve (only) and on the level of savings, investment, and the equilibrium real interest rate in the financial crisis that hits United States first starting in fall 2007.

  Affect of falling domestic investment on trade surplus and

How will a fall in domestic investment affect the trade surplus and net capital outflows in the domestic economy, the trade deficit and capital inflows in the rest of the world.

  Crises in the banking sector and bank run

Banking crises crisis decreases depositors' confidence in the banking system. What would be the effect of a rumor about a banking crisis on checkable deposits in such a country?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd