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- Add comments, discussion or calculations to your PART TWO document as directed. The market demand and supply curves for Quebec maple syrup are given by Qd = 2000 – 45P Q, = 35P+ 1000 where the quantities Q are in 1000s of gallons per year. The government of Quebec, seeking additional revenue sources, imposes a $2 per gallon tax on all maple syrup sold in the province. IN YOUR PART TWO DOCUMENT, your work in calculating the size of the deadweight loss of this tax on the market, and drawing relevant pictures. HERE answer the following question: How much deadweight loss will there be as a result of the tax?Example: Question 4a.) Arthur’s demand to reduce electric and magnetic fields (EMFs) is P = 20 – 2 Q, whileRonald’s demand is P = 15 – 3 Q. If the marginal cost of reducing emissions is equal to$15 and is constant, what is the optimal amount of EMF reduction? b.) What Lindahl prices would you charge Arthur and Ronald? What might prevent you fromcollecting these prices?c.) How would your answers change if the marginal cost of reducing emissions was equal to$10 and is constant?d.) What are the consumer surpluses of Arthur and Ronald in c.)?In 1998, California became the first state to adopt rules requiring many sport utility vehicles, pickups, and minivans to meet the same pollution standards as regular cars, effective in 2004. As the deadline drew near, a business group (which may have an incentive to exaggerate) estimated that using the new technology to reduce pollution would increase vehicle prices by as much as $7,000. A spokesperson for the California Air Resources Board, which imposed the mandate, said that the additional materials cost was only about $70 to $270 per vehicle. Suppose that the two major producers are Toyota and Ford, and these firms were price setters with differentiated products. Show the effect of the new regulation. Is it possible that the price for these vehicles would rise by substantially more than the marginal cost would? Explain your answer.
- what will happen in the marketfor tomatoes if a new study is released that shows tomatoes contain antioxidants that may prevent cancer1. In Town A there is only one newspaper, Daily Outrage. The demand for the paper depends on the price and the amount of scandal reported. The demand function is Q = 15SP-3 where Q is the number of issues sold per day, S is the number of column inches of scandal reported in the paper, and P is the price. Scandals are not a scarce commodity in town A, but it takes resources to write, edit, and print stories of scandal. The cost of reporting S units of scandal is £10S and is independent of the number of papers sold. In addition, the cost to print and deliver the paper is £0.10 per copy and is independent of the amount of scandal reported in the paper. (a) Calculate the price elasticity of demand. Explain whether the price elasticity depends on the amount of scandal reported and whether the price elasticity is constant over all prices. Comment on the price sensitivity of the readers of the Daily Outrage. (b) Calculate the profit maximising price using the formula that writes marginal…2. Given the demand function of motorcycle: Q = 500 – 100P where Q is total quantity demanded (unit: 10,000) and P is daily price (in unit of US$). (1) If the current daily price is US$1.0, please find the total quantity demanded. (2) If the external costs of motorcycle ($2) are all internalized, what would be the total quantity demanded? (3) Please also discuss impacts of this internalization policy on supply, demand and public infrastructures.
- Review the graph below to answer this question. This graph reflects a being. produced. Price Popt. EX P1 Q opt. Q1 Quantity MSC MPC MSB _____externality where, at point Q1, the good isCurrently, 160 units of a pure public good have been provided. Alex’s demand curve for the public good is 40 −0.2q. If the price of the good is 8.5, what quantity of the public good, q, would Alex be willing to purchase?provide quick explanation and graph please! thank you.
- When there is a deadweight loss in the market, the marginal benefit must be larger than the marginal cost at the quantity transacted. Do you agree? Explain with a diagram.Inverse demand for washing machines is P = 27-.5Q and inverse supply is P = 7+.5Q. Each washing machine has a 3 unit externality associated with it. Find the market equilibrium, damages, deadweight loss, consumer, producer, and total surplus. Submit your workIf a paper manufacturer does not bear the entire cost of the dioxin it emits, it will Select one: emit a lower level of dioxin than is socially efficient. b. emit an acceptable level of dioxin. emit a higher level of dioxin than is socially efficient. a. C. O d. not emit any dioxin in an attempt to avoid paying the entire cost.