Competitive Markets and Externalities  1.What impact do policy interventions have on the supply and demand equilibrium for a product? Provide specific examples 2.What are the determinants of price elasticity of demand? Identify at least three examples? 3.Explain how price elasticity can impact pricing decisions and total revenue of the firm? 4.can policy market interventions cause consumer or producer surplus? Explain why using specific reasoning

1. In Town A there is only one newspaper, Daily Outrage. The demand for the paper depends on the price and the amount of scandal reported. The demand function is Q = 15SZP-3 where Q is the number of issues sold per day, S is the number of column inches of scandal reported in the paper, and P is the price. Scandals are not a scarce commodity in town A, but it takes resources to write, edit, and print stories of scandal. The cost of reporting S units of scandal is £10S and is independent of the number of papers sold. In addition, the cost to print and deliver the paper is £0.10 per copy and is independent of the amount of scandal reported in the paper. (a) Calculate the price elasticity of demand. Explain whether the price elasticity depends on the amount of scandal reported and whether the price elasticity is constant over all prices. Comment on the price sensitivity of the readers of the Daily Outrage. (b) Calculate the profit maximising price using the formula that writes marginal…

What is the likely effect of this strategy on profits and consumer surplus compared to charging only a single price? a. Quantity increases, profits increases, welfare increases. b. Quantity increases, profits increases, welfare decreases. c. Quantity decreases, profits increases, welfare decreases. d. Quantity decreases, profits decreases, welfare decreases. e. None of the other answers is correct.

Market power leads to markets that do NOT have socially optimal results. The _____ is higher and the _____ is lower than the socially optimal result in perfect competition. Select one: a. total cost; price b. output; demand c. price; output d. demand; total cost

(a) Find the point (A, B, C, D, or E) that corresponds to the profit maximizing price and quantity. (Select only one letter.) (b) Which number corresponds to consumer surplus on the graph? (c) Which number corresponds to producer surplus on the graph? (d) Which number corresponds to deadweight loss on the graph?

Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.

Price (dollars per unit) Price (dollars per unit) D Quantity (units per month) Figure B Quantity (units per month) Figure A Price (dollars per unit) Price (dollars per unit) D Quantity (units per month) Quantity (units per month) Figure C Figure D The above figure shows the demand curves in four different markets. If each of the markets has an identical upward sloping supply curve and the same tax is levied on suppliers, which market would produce the largest amount of deadweight loss? A) B B) C C) A D) D

The area under the demand curve up to unit Q 1 represents the total ____ of Q 1 to society.   A. surplus   B. gain   C. cost   D. benefit

2. Determine the amount of producer surplus generated in each of the following situations. a. David lists his talking Vin Scully Bobblehead on eBay. He sets a minimum acceptable price, known as his reserve price, of $75. After five days of bidding, the final high bid is eхactly $75. b. Jade advertises her car for sale in the used-car section of the student newspaper for $2,000, but she is willing to sell the car for any price higher than $1,500. The best offer she gets is $1,200. c. Ryan likes his job so much as a Chief of Staff for Andrew Yang's Campaign that he would be willing to do it for free. However, his annual salary is $80,000.

Identify at least one positive externality from running a donut shop. Identify at least one negative externality from running a donut shop. Explain how these positive and negative externalities could impact the donut shop’s profits. (Hint: think subsidy for positive externality and tax for negative externality.) Draw two graphs that show the price of donuts before and after the positive and negative externality impacted the price of your donuts.