The date is 05/20/2021. You were hired six months ago by your congressional representative as a policy advisor. Your boss has been very impressed with your insight and research, and has promoted you to be the primary economic policy advisor! As you are reading the economic news today, you come across the following headline: "Gas Rationing Set to Begin Monday". The article is discussing how an energy embargo imposed by the Oil Producing and Exporting Countries (OPEC) against the United States a year ago has resulted in a sudden, unexpected decrease in the supply of oil and, as a result, a sudden and unexpected jump in energy prices,
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- Consider the following scenario: In Great Britain, the electricity system operator publishes a wind generation forecast of 14 GW for 7 PM on the next day. On the morning of the next day, the electricity system operator revised its wind generation forecast for 7 PM down from 14 GW to 11 GW. Do you expect the wholesale electricity market price for 7 PM to increase or decrease at this time? Explain your answer.Please explain how an increase in the price of crude oil can affect the Canadian economy.The October 17, 2022 edition of The Wall Street Journal included an article titled “New England Risks Winter Blackouts as Gas Supplies Tighten” (it is not necessary for you to read the article; we will provide all relevant information in the questions we ask). The article starts with a sentence: “New England power producers are preparing for potential strain on the grid this winter [Winter 2022-23: December 2022 through February 2023] as a surge in natural-gas demand abroad threatens to reduce supplies they need to generate electricity.” For Question 1, consider the New England market for electricity prior to Winter 2022-23 by considering this setting roughly one year ago, in December 2021. Assume that in December of 2021, the market for electricity was in a short-run equilibrium. Draw a graph that shows supply and demand for electricity market in its December 2021 equilibrium. This graph will serve as a starting point for your analysis in Questions 2 through 5. When drawing this…
- (30%) (page 5 of 6) - Profile 1 - Microsoft Edge =://2023.tle.courses.open.uwi.edu/mod/quiz/attempt.php?attempt=12768&page=4&cmid=37072 The Learning Exchange 2023 Suppose now that the government decides to increase the number of quotas available to 72 units, but it keeps the price support at the current level of $72. (HINT: Sketch the supply and demand equations.) d) Calculate (1) the consumer surplus, 529 (ii) the producer surplus, 506 (iii) deadweight loss (use 2 decimal places), 88.02 (e) Which of the two options would the producers prefer? Option 1 + (f) Which of the two options would be preferred by society? Option 1You have been asked to explain to Magdalena Andersson and Per Bolund what the effects will be of raising the tax on petrol by SEK 2 per liter (the tax is paid by the sellers). Magdalena Andersson (Minister of Finance) would very much like to know how much the tax revenue is affected and Per Bolund (Minister of the Environment) would like to know how the consumption of petrol (and thereby the environment) is affected. Explain to them under what circumstances consumption decreases much and little, and under what circumstances the tax increases much and little. Keep in mind that Per Bolund has not studied economics, so you should explain the terms you use if there is a risk of misunderstanding.The aggregate demand and supply for Cancum are shown in the table below. Potential GDP (LAS) is $1,200 billion. Price Index 105 110 115 120 125 130 135 140 Aggregate Quantity Demanded 1,300 1,200 1,100 1,000 900 800 700 600 Aggregate Quantity Supplied 325 650 850 1,000 1,100 1,200 1,300 1,350 a. If the economy is in equilibrium, it experiencing a(n) (Click to select)✓ gap of $ b. Suppose government uses countercyclical fiscal policy to close the gap. In order to achieve full employment AD would have to (Click to select) by $ c. As a result of this change, the inflation rate would be %. Round your answer to 2 decimal places.
- Problem 6-9 Demand change effects on government revenue The market for Titanium has supply given by P = Q and demand given by P = 12 - Q. The government introduces a tax of €3/g. Yet, the market experiences growth in the demand for titanium because of new-found medical uses. The new demand curve is P= 13 - Q. Find the change in government tax revenue due to the increased demand for titanium. (Round your answer to one decimal place.) € millionIn a hypothetical situation, Government of Pakistan wants to put a curb on cigarette smoking through economic policy: Studies indicate that the price elasticity of demand for cigarettes is about 0.5. If a pack of cigarettes currently costs Rs.200 and the government wants to reduce smoking by 22 percent, by how much should it increase the price? If the government permanently increases the price of cigarettes, will the policy have a larger effect on smoking one year from now or five years from now? Studies also find that teenagers have a higher price elasticity of demand than adults. Why might this be true?Imagine you are the owner of a natural gas company. You can either extract as much of the resource as fast as possible or delay extraction until a future time. Projections indicate that the price of natural gas is expected to fall in the future. What would you do in the present? a. Sell as much natural gas as possible now and less in the future—reflected by a rightward shift of the current supply curve in the future. B. Sell as much natural gas as possible now and less in the future—reflected by a movement down the current supply curve.C. Sell as much natural gas as possible now and less in the future—reflected by a movement up the current supply curve.D. Sell as little natural gas as possible in the present and delay extraction until the future—reflected by a leftward shift of the current supply curve in the future.
- Question-05: A vegetable fiber is traded in a competitive world market, and the world price is $9 per pound. Unlimited quantities are available for import into the United States at this price. The U.S. domestic supply and demand for various price levels are shown as follows: U.S. Supply (Million LBS) U.S. Demand Price (Million LBS) 3 34 6 4 28 9. 22 12 8 16 15 10 10 18 12 4 What is the equation for demand? What is the equation for supply? а. b. At a price of $9, what is the price elasticity of demand? What is it at a price of $12? What is the price elasticity of supply at $9? At $12? c. In a free market, what will be the U.S. price and level of fiber imports? d.When the price is 10 TL for each pack of cookies, the supply is 250 thousand and the demand is 120 thousand boxes. When the price is 9,5 TL for each pack of cookies, the supply is 200 thousand and the demand is 240 thousand boxes. Since the price-demand and supply-demand equations are linear; Calculate the producer and consumer annuity and find and interpret the market equilibrium point after-tax if the consumer is taxed at a rate of 0,75 TL per product.11. Suppose that you develop a software product called "EconSolver" which takes in the parameters of an economic problem and first determines how to solve it and then solves it. You have two potential markets for this product: corporations (c) and students (s). The demand schedules you have estimated are: Price Dc 10 11 12 13 14 15 16 DS 0 2 4 6 8 10 12 Production, distribution and software support costs are estimated to be $50 per copy for each type of customer. 300 275 250 225 200 175 150 (i) Assume that you could only charge one price for this product regardless of customer type. What would that price be and how much profit would you make? (ii) Assume that you could practice 3rd degree price discrimination in this market. What price would you charge each customer type and what would your total profits be? (iii) Use the language of economics to explain why 3rd degree price discrimination works in this example. (iv) If you decided to practice 3rd degree price discrimination here, list…