Corn is an essential commodity in a small Central American country and the government intends to impose a tax onrich consumers in order to subsidize the consumption by the poor. The demands of these two groups are definedby P = 105 - qr and P = 50 - qp, respectively. The supply curve is infinitely elastic at P = 20.a.If the government wants to give a subsidy S = 10 for each unit sold to the poor, how much would thegovernment have to spend?100400300600None of the options b.What unit tax would the government have to impose on rich consumers in order tobalance the budget?10536None of the options

Solution:- Subsidy means the benefit granted by the government by decreasing the price, while by…

Answered: 1. Corn is an essential commodity in a…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

See similar textbooks

Similar questions

Mr. JKL is considering replacing 250 hectares of maize with 250 hectares of sunflower seed. His expected yield is 3.7 tons per hectare for maize and 2.5 tons per hectare for sunflower. The expected selling prices are R 3 500 per ton for maize and R 5 200 per ton for sunflower. He estimates a variable cost of R 7 350 per hectare for maize and R 8 300 per hectare for sunflower. I. Calculate the expected change in net income for the farmer’s proposed change. II. Briefly advise the farmer if the change is desirable or not.
Want answer with explanation. thanks
Solve
Solve it correctly please. I will rate accordingly with 4votes.
Please help me with this question
Ee.101.
The following question is based on the demand and cost data for a pure monopolist given in the table below. Output Price Total Cost 0 $500 $250 12345 300 260 250 290 200 350 150 500 100 680 Refer to the above table. If the monopolist were forced to produce the socially optimal output through the imposition of a ceiling price, the ceiling price would have to be set at: O $100 $150 O $200 $250 www.yout House of High Ant SWEPT his OVER HIM
A Chinese automobile company is going to use one of its unused manufacturing plants in China to produce 20,000 cars a year. The cars will then be sold in the United States for $40,000 per vehicle. The plant has been fully depreciated. Production and assembly costs in China will be RMB 120,000 per vehicle and selling and administrative costs in the U.S. will be $30 million per year. The company will pay taxes in China at a rate of 35% and will not pay taxes in the U.S. Assume the current exchange rate is 7 RMB/$. It is expected that the plant will operate for 5 years and then cease operations. What are the expected yearly sales, expressed in RMB, assuming the current exchange rate? 5,600,000,000 800,000,000 560,000,000 3,600,000,000 What is the expected yearly net after-tax cash flow, expressed in RMB, assuming the exchange rate stays constant? 5,600,000,000 1,943,500,000 3,170,000,000 2,990,000,000 What is the change in cash flow, in RMB, if the RMB appreciates to 6.5…
1. As part of its environmental strategy, the Antland government wishes to reduce the annual consumption of coal- fired electricity by 5%. Antland government economists have analysed data which reveal that the price elasticity of demand for coal-fired electricity is -0.4. Consequently, to achieve its target the Antland government should A reduce the price of coa-fired electricity by 12.5% reduce the price al coal-fred electricity by 2% raise the price or coa-fired electricity by 12.5% raise the price of coal-fired electricity by 2% 2. A consultant has made two statements about the responsibility of a professional accountant to act om the public interest: Satisfying the needs of their clients means that a professional accountant in public practice has fulfilled their responsibility to act in the public interest As part of their public interest responsibility, professional accountants must report acts misconduct which they encounter Are these statements accurate or…
1. Consider a pure exchange economy with two goods and two consumers. Let F denote food and C denote clothing. Lacy has the utility function U(F, C) = F 1/3 C 2/3 . Roy has the utility function V (F, C) = F 2/3 C 1/3 . Each consumer has an initial endowment consisting of 9 units of F and 9 units of C. Normalize the price of F to one. Let P denote the price of C. (a) Is the initial endowment a Pareto efcient allocation of F and C between the two con sumers? Explain briefy. (b) What is each consumer’s demand for F and C as a function of P? [Hint: the wealth of each consumer is 9 + 9P.] (c) What is the price of C in a competitive equilibrium? (d) What is the allocation of F and C between the two consumers in a competitive equilibrium?
A consumer's utility only depends on the consumption of goods A and B according to the following Cobb - Douglas utility function: U(A, B) = A3/5 B 2/5. The price of goods A and B are $10 and $10, respectively. The consumer has a budget of $1500 that he can use to consume the two goods. a) Calculate the optimal bundle and maximized utility for the consumer. b) A new tax of $5 is imposed on the price of good B. Compute the new optimal bundle of good A and B for the same consumer. What is the utility loss due to the tax? c) Show that the consumer would prefer a lump sum income tax that raises the same revenue of $200 as the tax on good B.
Fertilizer supply is explained by the following equation: ?? = 3,000? where ?? is the supply per year and ? is the price of fertilizer per ton. Demand for fertilizer is explained by: ?? = 500,000 - 20,000? where tons there is a lot of fertilizer demanded every year. The marginal external cost of $ 30 is associated with the production per ton of fertilizer due to pollution associated with fertilizer production. Answer the following questions and explain your answer by showing your work.Competitive market price is $21.74. Tons of fertilizer will be produced per year is 65,217.39. Is the market equilibrium efficient? Explain your answer.d. What is the efficient quantity and output?

Recommended textbooks for you

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

Corporate Finance (The Mcgraw-hill/Irwin Series i…

Finance

ISBN:

9780077861759

Author:

Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS