The distance between two cities, A and B, is 200 miles. The populations in these two cities are, respectively, 20,000 and 10,000. What is the distance, in miles, between city A and the breaking point?
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The distance between two cities, A and B, is 200 miles. The populations in these two cities are, respectively, 20,000 and 10,000. What is the distance, in miles, between city A and the breaking point?
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- The following graph shows a fictional world economy that consists of only two countries, Greenberg and Baxton. Both countries produce airplanes under increasing-cost conditions. Note that the left-hand part of the diagram is a mirror image of a standard supply-demand diagram, and therefore the supply and demand curves slope in directions opposite their usual directions. Greenberg Baxton 30 27 24 +18 + + 15 12 In the absence of trade (that is, autarky), the equilibrium price in Greenberg is $ and the equilibrium price in Baxton is |. (Hint: Enter all monetary values in full. For example, $7,000 rather than $7.) In the absence of trade, which of the following statements is correct? O Greenberg has the comparative advantage in production of airplanes. O Greenberg and Baxton are equally good at producing airplanes. O Baxton has the comparative advantage in production of airplanes. Now suppose both countries open up to international trade with each other. For each country, use the previous…Suppose that the world price of oil is roughly $90.00 per barrel and that the world demand and total world supply of oil equal 34 billion barrels per year (bb/yr), with a competitive supply of 20 bb/yr and 14 bb/yr from OPEC. Statistical studies have shown that the long-run price elasticity of demand for oil is -0.40, and the long-run competitive price elasticity of supply is 0.40. Using this information, derive linear demand and competitive supply curves for oil. Let the demand curve be of the general form Q=a-bP and the competitive supply curve be of the general form Q=c+dP, where a, b, c, and d are constants. The equation for the long-run demand curve is A.Q=47.50-0.15P. B.Q=13.50-47.50P. C.Q=47.50-P. D.Q=47.50+0.15P. E.Q=13.50-0.15P.Two countries, Alpha and Beta consider the construction of a bridge across a river that separates them. The bridge would increase commerce and trade in both countries. If they both contribute to the building of this bridge, then each receive a profit of $32 million. However, if they both fail to contribute, they are each left with a profit of just $30 million. If one country contributes and the other one does not, then the country that does not contribute is a “free rider” and will receive a profit of $35 million. The contributing player spends a lot of money building the bridge and is left with a profit of only $28 million. 5.1. Fill out the payoff matrix (below) for the game by including all the elements (players, their strategies, and their payoffs). 5.2. Assume the players do not cooperate. Solve the game for the Nash equilibrium (find out the strategy played by each player in equilibrium). What is the payoff each gets…
- You are given a brief about Ghana highlighting the following points: About half of Ghana’s population depends on agriculture, but Ghana still imports some of its food. The majority of Ghana's people live in rural areas and exist on a subsistence way of life. Ghana has one of the highest rates of income inequality in the world. Nearly half of the population is employed in agriculture. A representative from Ghana's agricultural organisation is very much in favour of closing borders. He argues that consumers and producers will benefit from this. Is he right? Who would benefit most, are there any losers from the policy?The supply and demand for wheat in the small country Tinyland are: Qs = P and Qd = 400 – P, respectively. The world price of wheat is Pw = 100. a. Suppose the government imposes an import quota on wheat Q = 100. Find the price of wheat in Tinyland. Find the tariff per unit that generates the same volume of trade as the quota. Next suppose that instead of a quota or a tariff, the government levies a specific (per unit) consumption tax on wheat. Find the price of wheat in Tinyland when the tax is equal to the tariff you found in part ii and the quantity of wheat imported. NB: In contrast to a tariff, which is levied on all units produced abroad (imported), i. ii. a consumption tax is levied on all units sold in the domestic market regardless of where they were produced. b. Which of these three policies, i.e., quota, tariff, and consumption tax, do consumers and producers prefer? Give precise answers by evaluating the welfare of each group. Assuming that the government allocates quota…The model (graph) below represents a small country trade of good X after the government decided to impose tariffs on import. Consider the case of trade after tariffs. Please answer the following questions: What area(s) represent the gain of surplus to producers? What area(s) represent government revenue? What area(s) represent the loss of surplus to consumers? What area(s) represent consumers surplus? What's the quantity imported? Describe the impact of a tariff on social welfare. Refer to the graph to support your answer. A Qs Qs,t QD₂t Q₂ Quantity Edit View Insert Format Tools Table Price Pw+t Pw G C
- Why do you study comparative politics? Describe why in 3-5 sentences.Consider a hypothetical world consisting of only three countries: Hungary, Australia, and Italy. Each country produces grain. Hungary is a small economy compared to Australia and Italy and thus cannot influence foreign prices. On the following graph, the supply and demand schedules of Hungary are shown as Sun and Dun. Foreign supply schedules of grain are perfectly elastic: Australia is a more efficient supplier of grain than Italy because its supply price is $1.00 per bushel (SAus), whereas Italy's supply price is $2.00 per bushel (Sita). PRICE (Dollars) 10.00 9.00 8.00 7.00 6.00 5.00 4.00 3.00 2.00 1.00 0 Hun S +T S₁ +T S S + 0 3 6 A Scenario Free trade With tariff With customs union m SHu 12 15 18 21 24 27 30 GRAIN (Thousands of bushels) Calculate the quantity of bushels Hungary imports when the three nations engage in free trade. Enter this value in the first row of the following table. Also indicate which country Hungary imports from. ? Imports (Thousands of bushels) Imports…Explain the difference between absolute advantage and comparative advantage. Which is the basis for international trade, and why? The graph below represents the market for sugar in the U.S. The domestic supply and demand curves are drawn, the world price for sugar is indicated, and the effect of a tariff the US is imposing on sugar imports is shown. Use the graphic to calculate consumer surplus, producer surplus, economics surplus, government revenue, and deadweight loss. Do so under each of the following three situations: 1) no trade, 2) free trade, and 3) the sugar tariff. A friend tells you the following: “Free trade sounds good, but a country like Honduras doesn’t have any comparative advantage compared to the United States. Therefore, trade with us will exploit them and make their economic situation worse.” Explain to your friend the error in his thinking.
- 15 10 5 7 11 6) The above graph shows the supply and demand for cotton in the country of Spartania. The world price of cotton is $15. Spartania is able to import and export cotton, if it chooses to. Which of the following is true? A) Spartania will import 2 units of cotton. B) Spartania will import 4 units of cotton. C) Spartania will export 2 units of cotton. D) Spartania will export 4 units of cotton.The demand for cameras in a certain country is given by D=8000−30P, where P is the price of a camera. Supply by domestic camera producers is S=4000+10P. Suppose that world price of a camera is $150. If this country decides to trade, which of the following is true? Group of answer choices 3000 cameras will be exported Domestic production of cameras will decrease by 500 Domestic production of cameras will increase by 500 2000 cameras will be importedFor many purposes, the use of a tariff is said by economists to be “second best.” This means that Group of answer choices Another policy exists that would accomplish the same purpose as the tariff at lower economic cost. The tariff does not help those with the highest incomes, but only those with the second highest. The tariff benefits the country only by making other countries worse off. The tariff cannot be beneficial for the country as a whole.