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1. How does the marginal social benefit curve of a common resource compare to the marginal social benefit curve of positive externality from a mixed good? Highlight the differences through graphs.
2. a. Suppose the demand for saline solution is perfectly inelastic for contact lens wearers. If the government imposes a tax on saline solution, what occurs? Be sure to tell what happens to the price paid by the buyers and discuss the incidence of the tax.
b. If income tax rates on labor income are decreased, what is the effect on the labor supply and the labor supply curve? What is the effect on the equilibrium quantity of labor hired?
It is clear that monopsony in the labor market is not steady with allocative efficiency and has the effect of withholding significant amounts the employees' MRP from them, that bec
Problem: i) The inverse market demand curve for a Stackelberg leader and follower is given by P = 10 - Q. If each has a marginal cost of $4, what will be the equilibrium qu
what is mrs
2) Proctor & Gamble (P&G) and the Lever Co. decide to form a laundry detergent cartel for future sales in Europe. Lever is more efficient than P&G. a)illustrate graphically how the
Q. What do you meant by Progressive Tax? Progressive Tax:Tax is considered progressive if a larger proportionate share of its total burden falls on individual'swith higher avera
Case 1: The market for drugs Supply, demand, and equilibrium: The market for drugs. Suppose the market for drugs is a perfectly competitive market. Let the supply curve
Marginal Product Theory a. What is the MC of output in the short-run? b. What is the MC of labor (employed)? c. What is the short-run profit-maximizing decision
define and explain the concept of social efficent production
Policy Implications: The expansion of the services sector has wider implications for population, employment, and trade prospects of the economy, some of which are as follows:
Problem: i) What is meant by ‘own' price elasticity of demand? What factors are likely to affect the size of this elasticity? ii) A publicly owned bus line is running at
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