Apple Republic and Banana Republic have 60,000 workers and 120,000 workers, respectively, and labor is the only factor of production. Unit labor requirements for both countries are given in the table below. Units of labor required per unit of output Apple Banana 4 4 2 8 Compute relative autarky price ratios (price of pork relative to that of fish) for both countries, defined as Pp/PF. Pork Fish

Apple Republic and Banana Republic have 60,000 workers and 120,000 workers, respectively, and labor is the only factor of production. Unit labor requirements for both countries are given in the table below. Units of labor required per unit of output Apple Banana 4 4 2 8 Compute relative autarky price ratios (price of pork relative to that of fish) for both countries, defined as Pp/PF. Pork Fish

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Now suppose other countries produce cassava and Côte d'Ivoire can import cassava at the world price (Pw) which is lower than the autarky (e. economic independence or self-sufficiency) price (Pa). Figure 2 below depicts the demand and supply curves for cassava in Côte d'Ivoire with imports. Quantity is represented on horizontal axis and price is on the vertical axis. Carefully examine Figure 2 and answer questions 8-11 that follow: Note: Qa is the Autarky quantity, Qs is the quantity of cassava supplied by producers in Côte d'Ivoire, and Qd is the quantity of cassava demanded by consumers in Côte d'Ivoire after import Figure 2: Demand and Supply of Cassava in Côte d'Ivoire with Imports Price ($) Pa Oa 9b OC Od OF or Pw 0 a Qs U d la la D₂ Quantity (kg) Question 8: Using the letters (i.e. a, b, c, d, e, f) from Figure 2, which area represents the producer surplus if Côte d'ivoire imports cassava at the world price (Pw)? Select all that apply.
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?
The following graph shows the domestic demand for and supply of oranges in Guatemala. The world price (Pw) of oranges is $550 per ton and is displayed as a horizontal black line. Throughout the question, assume that all countries under consideration are small, that is, the amount demanded by any one country does not affect the world price of oranges and that there are no transportation or transaction costs associated with International trade in oranges. Also, assume that domestic suppliers will satisfy domestic demand as much as possible before any exporting or importing takes place. PRICE (Dollars per ton) 820 790 760 730 700 670 640 610 580 550 520 0 Domestic Demand 1 Domestic Supply PW 30 60 90 120 150 180 210 240 270 300 QUANTITY (Tons of oranges) A tariff set at this level would raise (~.) ? If Guatemala is open to International trade In oranges without any restrictions, it will import Suppose the Guatemalan government wants to reduce imports to exactly 60 tons of oranges to help…
The following graph shows the domestic demand for and supply of lemons in Guatemala. The world price (Pw) of lemons is $260 per ton and is displayed as a horizontal black line. Throughout the question, assume that all countries under consideration are small, that is, the amount demanded by any one country does not affect the world price of lemons and that there are no transportation or transaction costs associated with international trade in lemons. Also, assume that domestic suppliers will satisfy domestic demand as much as possible before any exporting or importing takes place. PRICE (Dollars per ton) 460 Domestic Demand Domestic Supply 435 410 385 360 335 285 260 235 PW 210 0 10 20 30 40 50 60 70 QUANTITY (Tons of lemons) 80 90 100 If Guatemala is open to international trade in lemons without any restrictions, it will import tons of lemons. Suppose the Guatemalan government wants to reduce imports to exactly 20 tons of lemons to help domestic producers. A tariff of $ will achieve…
using partial equilibrium analysis, explain how is the equilibrium relative commodity prices between two nations determined and explain why is it the equilibrium relative commodity price between two nations?
Two countries, Home (H) and Foreign (F) trade agricultural and manufacturing goods (A and M, respectively). Production of either good requires skilled and unskilled labor. Unskilled workers can freely move from one sector to another, while skilled workers cannot. Identify mobile and industry-specific factors of production (b) Suppose Home is relatively more productive in agriculture than Foreign. Draw two diagrams, one for H one for F, which illustrate no-trade equilibrium in each county. Compare relative price of agricultural goods in two countries.
Kazakhstan is a grape producer, as well as an importer of grapes. Suppose the following graph shows Kazakhstan's domestic market for grapes, where SK is the supply curve and DK is the demand curve. The free trade world price of grapes (Pw) is $800 per ton. Suppose Kazakhstan's government restricts imports of grapes to 60,000 tons. The world price of grapes is not affected by the quota. Analyze the effects of the quota on Kazakhstan's welfare. On the following graph, use the purple line (diamond symbol) to draw the Kazakhstan's supply curve including the quota Sk+Q. (Hint: Draw this as a straight line even though this curve should be equivalent to the domestic supply curve below the world price.) Then use the grey line (star symbol) to indicate the new price of grapes with a quota of 60,000 grapes. PRICE (Dollars per ton) 4000 3600 3200 2800 2400 2000 1600 1200 800 400 0 0 20 SK K P W 40 60 80 100 120 140 160 180 200 QUANTITY (Thousands of tons) SK+Q The equivalent import tariff for…
Kazakhstan is a grape producer, as well as an importer of grapes. Suppose the following graph shows Kazakhstan's domestic market for grapes, where SK is the supply curve and Dk is the demand curve. The free trade world price of grapes (Pw) is $800 per ton. Suppose Kazakhstan's government restricts imports of grapes to 120,000 tons. The world price of grapes is not affected by the quota. Analyze the effects of the quota on Kazakhstan's welfare. On the following graph, use the purple line (diamond symbol) to draw the Kazakhstan's supply curve including the quota SK+Q. (Hint: Draw this as a straight line even though this curve should be equivalent to the domestic supply curve below the world price.) Then use the grey line (star symbol) to indicate the new price of grapes with a quota of 120,000 grapes. PRICE (Dollars per ton) 4000 3600 3200 2800 2400 2000 1600 1200 800 400 0 0 40 80 120 160 200 SK 240 10 0² W 280 320 360 400 SK+Q Price with Quota A Change in PS Quota Rents DWL ?
From a resource-based perspective: what resources are needed to develop a machine for a distance market, such as China, and where in the MNE are those to be found?
The following graph shows the domestic demand for and supply of lemons in Panama. The world price (Pw) of lemons is $245 per ton and is displayed as a horizontal black line. Throughout the question, assume that all countries under consideration are small, that is, the amount demanded by any one country does not affect the world price of lemons and that there are no transportation or transaction costs associated with international trade in lemons. Also, assume that domestic suppliers will satisfy domestic demand as much as possible before any exporting or importing takes place. PRICE (Dollars per ton) 485 455 425 395 365 335 305 275 245 215 185 Domestic Demand A I 1 0 10 20 Domestic Supply 30 40 50 60 70 QUANTITY (Tons of lemons) I 1 A tariff set at this level would raise $ Pw 80 90 100 (?) If Panama is open to international trade in lemons without any restrictions, it will import Suppose the Panamanian government wants to reduce imports to exactly 40 tons of lemons to help domestic…
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