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Take a look at the sugar market: US demand: Q=60-2/3 P US domestic supply: Q=P Also, the US could import any quantity from world producers at (US$) 10/cents per lb
a) In a scenario with free trade- what would be equilibrium price in US, also what would be consumer surplus and producer surplus?
b) Assume FDA changes its mind and opens her US to sugar imports; however the government wants to promote domestic sugar production by giving a subsidy of 15 cents/lb
What would be new equilibrium price and quantity?
How much is domestic produced and how much is imported?
What is new consumer surplus and producer surplus?
What is deadweight loss compared to the scenario in question a)?
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Illustrate about the Effective exchange rate Assume that we are interested in external competitiveness of a country, say Japan. To do this we could look at evolution of a speci
Suppose the demand for guitars in State College is given by Qd = 9000 - 12P where Qd is the quantity demanded, and P is the price of guitars. Also, suppose the supply of guitars is
Over the last year both the supply and demand for oil in the US has gone up. What might have caused this and what happened to the price and quantity of oil?
P and Y are both endogenous variables and according to the quantity theory of money we need P.Y = constant. If we divide both sides by P we get Y = constant / P. Because Y = Y D i
HOW TO GET THE REVENUES AND EXPENDITURES AS A PERCENT OF GDP?
what wil hapen to the real wage if the nominal wages and prices rise at the same rate per year?
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