a) Identify the type of market failure illustrated by the graph. Explain. b) Using the numbers on the graph, identify the market equilibrium price and quantity. c) Using the labeling on the graph, identify the area representing the deadweight loss at the quantity identified in part (b). d) Suppose the government is considering granting a subsidy to correct the market failure. What is the dollar value of the per-unit subsidy that would achieve the socially optimal quantity? e) Suppose the government does not grant the subsidy and instead imposes a price floor at $8. (i) How many units will consumers and producers exchange at the price floor? (ii) Does the price floor correct the market failure? Explain.

Q: Auto insurance can protect you while you are walking on the street or riding a bicycle. True or…

A: Insurance is a kind of financial risk management.It's a kind of risk management that's mostly…

Q: (Trade Restrictions) Suppose that the world price for steel is below the U.S. domestic price, but…

A: When a country wants to restrict its imports of foreign goods it can use two devices: Tariffs…

Q: g softw

A: Resume screening software helps in recruitment and acquisition departments of talent lead to…

Q: What is a company/business that is currently in the news. Why is it in the news? Is this good or…

A: The systematic examination and assessment of economic phenomena, such as the creation, exchange, and…

Q: Financial statements, what are they? what are they used for? Why are they important? What are the…

A: For business , individual , lender , government financial statements are very useful to know the…

Q: Sara has health insurance with a $2,000 annual deductible, a $3,000 stop loss provision and 80/20…

A: Insurance refers to a type of financial product intended to shield people and businesses from the…

Q: Where do you get the number 11?

A: Given, Marginal propensity to save (mps)=0.2 Marginal propensity to import (mpm)=0.1 Marginal income…

Q: expensive

A: Suits are considered to be an important part of the professional world and a suit also tends to…

Q: The average monthly balance in Derek's bank account is $750. Derek spends the same amount of money…

A: Let's assume X is the starting balance. At the end of the month, the balance is $0 The average…

Q: How do insurance companies make money?

A: As a for-profit firm, an insurance company must develop an internal business model that collects…

Q: What are criminal prosecutions?

A: The court is the place where trials and legal cases take place.

Q: Are there gender differences in making financial decisions?

A: Financial decisions involve choices about how to allocate and manage money, assets, and resources to…

Q: An impersonal group whose members pursue a specific goal or activity is

A: Hi, this is a sociology question and we do not cater to it yet but since the expert knows the…

Comparative Advantage and Absolute Advantage Analysis

The theory of absolute advantage was given by Adam Smith in the year 1776.