Business, 25.10.2020 04:30 JOHNDoe3443

Consider (again!) a 2 period model (assumptions: P=8- 0.4Q, MEC=2, r=10%, reserves = 20 units, similar to the example discussed in the lectures) where the government sets a price ceiling of Pc=4. We found that the efficient price in period 2 is 4.095. This means that the price control will be binding/constraining in the second time period, that is you know that P2 * =4. a. Derive the quantity allocation across time periods (Q1

, Q2) given the price control

b. Derive the resource price in period 1 that yields this allocation (P1)

c. What is the Marginal User Cost in both time periods (MUC1, MUC2*)

d. Compute the present total surplus with price control and compare to the surplus

without it

e. Explain the intuition behind this result.

Answers: 2

Show answers

Another question on Business

Business, 22.06.2019 09:50

The returns on the common stock of maynard cosmetic specialties are quite cyclical. in a boom economy, the stock is expected to return 22 percent in comparison to 9 percent in a normal economy and a negative 14 percent in a recessionary period. the probability of a recession is 35 percent while the probability of a boom is 10 percent. what is the standard deviation of the returns on this stock?

Answers: 2

Answer

Business, 22.06.2019 11:00

Which statement best describes the variety of workplaces commonly found in the health science career cluster? a. workplaces in this cluster include healthcare facilities such as hospitals, physician offices, and clinics. b. workplaces in this cluster include healthcare facilities, laboratories, and other environments such as offices or homes. c . workplaces in this cluster include nonprofit hospitals, government-run clinics, and private physicians' offices. d. workplaces in this cluster include private and nonprofit hospitals and clinics, and dentists' offices.

Answers: 1

Answer

Business, 22.06.2019 11:30

Leticia has worked for 20 years in the public relations department of a large firm and has been the vice-president for the past ten years. it is unlikely she will ever be promoted to the top executive position in her firm even though she has directed several successful projects and is quite capable. her lack of promotion is an illustration of (a) the "glass ceiling" (b) the "glass elevator" (c) the "mommy track" (d) sexual harassment

Answers: 3

Answer

Business, 22.06.2019 16:00

If the family’s net monthly income is 7,800 what percent of the income is spent on food clothing and housing?

Answers: 3

Answer

You know the right answer?

Consider (again!) a 2 period model (assumptions: P=8- 0.4Q, MEC=2, r=10%, reserves = 20 units, simil...

Questions

Business, 25.09.2019 15:00

Tutors for students (tfi) is an organization with the purpose of offering free tutoring to older students. tfi does not expect to earn any money throu...