The New York Times (Nov. 30, 1993) reported that “the inability of OPEC to agree last week to cut production has sent the oil market into turmoil … [leading to] the lowest price for domestic crude oil since June 1990.”a. Why were the members of OPEC trying to agree to cut production?b. Why do you suppose OPEC was unable to agree on cutting production? Why did the oil market go into “turmoil” as a result?c. The newspaper also noted OPEC's view “that producing nations outside the organization, like Norway and Britain, should do their share and cut production.” What does the phrase “do their share” suggest about OPEC's desired relationship with Norway and Britain?

Supply-side economic policy is designed to   Move the economy from a point inside the PPC to a point on it, and shift the aggregate supply curve to the left. Move the economy from a point inside the PPC to a point on it, and shift the aggregate supply curve to the right. Shift the production possibilities curve outward and shift the aggregate demand curve to the right. Shift the production possibilities curve outward and shift the aggregate supply curve to the right.

The following figure illustrates the tomato market for Mexico, assumed to be a "small" country that is unable t to affect the world price. Suppose the world price of tomato is given and constant at $100 per ton. SM is the domestic supply and DM is the domestic demand for Mexico. Now suppose the Mexican government provides production subsidy of $200 per ton to its tomato producers. SM (with subsidy) is Mexico's supply schedule with production subsidy. Price ($) 800 300 100 0 2 8 SM 20 SM (with subsidy) World price DM Tons of Tomatoes Refer to the figure above. As a result of the production subsidy, the deadweight loss to Mexico equals [Select]

(a) Boreland and Pipeland are two countries producing toycars, having the following demand and supply conditions : Boreland: DD: Q_(d)=10-2P SS:Q_(5)=2+2P Pipeland: DD: Q_(d)=8-2P SS: Q_(5)=4+2P (i) Given this information, what will be the world equilibrium price and quantity traded? (ii) The fixed cost of setting up a production chain of toycars by the exporting country in the importing country is $2.5, and the cost of transportation is $0.25 per toycar exported. Which route would be preferred by the exporting country: producing toycars abroad or exporting the same from home? (iii) In the light of the above answers, explain the tradeoff faced by the exporting country. PLease answer all three (i),(ii)and(iii)

The figure to the right shows a country in pretrade equilibrium at point X. Suppose this country is abundant in the factor that is used intensively in the production of coal. Suppose the country begins to trade. Which of the following statements describes the production changes that will occur inside this country? OA. Coal output rises and sugar output falls OB. The output of both goods rises. OC. The output of both goods declines. OD. Sugar output rises and coal output falls. Click to select your answer 10 Sugar Os and Ds Coal Qc & Dc 10 G

PROBLEM (6) (Optimal tariff setting without the small country assumption) US demand and supply for wheat are Q = 120-p and Q = p respectively. The rest of the world ROW demand and supply for wheat are Q = 240 - 4p and Q = 2p respectively. Suppose the US is imposing $t (per unit) tariff for imports from the rest of the world. What should the tarifft be, in order to maximize Tariff Revenues?

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Topic 3 Assignment The following graph shows the domestic supply of and demand for maize in Bangladesh. Bangladesh is open to international trade of maize without any restrictions. The world price (Pw) of maize is $245 per ton and is represented by the horizontal black line. Throughout this problem, assume that the amount demanded by any one country does not affect the world price of maize and that there are no transportation or transaction costs associated with international trade in maize. Also, assume that domestic suppliers will satisfy domestic demand as much as possible before any exporting or importing takes place. Use the graph input tool to help you answer the following questions. You will not be graded on any changes you make to this graph. Note: Once you enter a value in a white field, the graph and any corresponding amounts in each grey field will change accordingly. 470 Supply 420 305 X I I Demand I PRICE (Dollars perton) 445 245 720 D P W 40 80 120 150 200 240 280 320 350…

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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.