not use ai please The following payoff matrix shows the outcomes for the United States and Russia from relying on conventional weaponsversus atomic weapons in a military conflict. The percentages refer to the fraction of the population that would die.0A 2 by 2 matrix. The subcolumn headers under the Russia are: Atomic weapons and Conventional weapons. The sub-row headers under the US are: Atomic weapons and Conventional weapons.This situation above illustrates a positional externality because

ConclusionThe situation described in the payoff matrix illustrates a classic case of a positional…

Answered: The following payoff matrix shows the…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Suppose that the world is comprised of two countries: X and Y. Because of the absence of centralized world governance, the control of global externalities is particularly challenging, which is the case with greenhouse gases linked to climate change. The entries in the following Payoff Table describe each country's well-being under different abatement patterns: X\Y No Abate Abate No Abate 12,12 24,8 Abate 8,24 20,20 Since according to scientific evidence, accumulated greenhouse emissions would progressively reduce global well-being, Business as Usual type of behavior may lead to catastrophic outcomes, raising questions about economic sustainability. Provide a definition of this concept and explain why commonly used measures of national economic performance like Gross Domestic Product and Net Domestic Product are not appropriate measures of sustainability. Using the concept of sustainability that you have defined, explain how the use of a non-renewable natural…
How did the ECONOMIC factor of the PESTELE model lead Trump when assessing TikTok as a threat toAmerica? Describe the factor and how it influenced Trump’s decision.
The government is concerned with air pollution and decided to apply a uniform standard in the country. Economists in the Ministry of Environment suggested the level Eu, based on studies that are concerned with the urban regions. Economists in the ministry of agriculture suggested the level Er, based on studies conducted on rural population. 2.1 What will be the total social cost of having a differential standard (set for the rural sector and for the urban sector separately)? (B + D + E) + (A + B + C + D + E) A + B +C + D + E + F B + D +E A +B +C +D + E 2.2 What will be the total social cost of having a standard for the country (both sectors) set at Er? (B + D + E) + (A + B + C + D + E + F) A + B +C + D + E + F B + D +E A +B +C +D + E 2.3 What will be the total social cost of having a standard for the country (both sectors) set at Eu? (B + D + E) + (A + B + C + D + E + F) A + B +C + D + E + F B + D +E (B + C + D + E) + (A + B + C + D + E)
Consider the following decision by two countries: a small country (C1) and a large country (C2). When both countries cooprate and agree to an environmental agreement, C1 receives 4 and C2 receives 5 units of benefit. When they do not cooperae, they incur costs of -1, and -2, respectively. The payoffs associated with other outcomes are described in the table below. Large country (C2) Agree to environmental protection (cooperate) Do not agree to environmental protection (do not cooperate) The Socially Optiomal outcome is The Nash Equilibrium is Agree to environmental protection (cooperate) C1:4 C2: 5 C1: 2 C2: 6 [Choose ] Small country (C1) [Choose ] Do not agree to environmental protection (do not cooperate) C1:2 C2: -3 C1: -1 C2: -2
Two countries the US (U) and Fiji (F). Each country i E {U, F} can decide whether to impose a positive tax on the emissions of its polluting firms (t;> 0) or to impose no tax (t; = 0). We can think of a representative firm that chooses whether to produce using a polluting technology (q=P) or a | clean technology (q = C). The polluting technology generates profits of л(P) = 11. The clean technology generates profits of л(P) = 10 and doesn't have to pay tax. Assume that when the firm is indifferent between the two technologies, it chooses the clean technology. Imposing a tax of t = 1, profits of firms using polluting technology would equal profits of firms using clean technology. Let us now turn to the decisions that the governments would make if they were inde- pendently choosing whether to impose a tax or not. In the US, firms using the clean technology emit a total of 0 tonnes of CO2 emissions, while firms using the polluting technology emit a total of 900 tonnes of CO2 emissions. In…
Two countries the US (U) and Fiji (F). Each country i E {U, F} can decide whether to impose a positive tax on the emissions of its polluting firms (t;> 0) or to impose no tax (t; = 0). We can think of a representative firm that chooses whether to produce using a polluting technology (q = P) or a clean technology (q = C). The polluting technology generates profits of (P) = 11. The clean technology generates profits of л(P) = 10 and doesn't have to pay tax. Imposing a tax of t = 1, profits of firms using polluting technology would equal profits of firms using clean. Assume that when the firm is indifferent between the two technologies, it chooses the clean technology. technology. Let us now turn to the decisions that the governments would make if they were inde- pendently choosing whether to impose a tax or not. In the US, firms using the clean technology emit a total of 0 tonnes of CO2 emissions, while firms using the polluting technology emit a total of 900 tonnes of CO2 emissions. In…
Two countries the US (U) and Fiji (F). Each country i E {U, F} can decide whether to impose a positive tax on the emissions of its polluting firms (t¡> 0) or to impose no tax (t; = 0). We can think of a representative firm that chooses whether to produce using a polluting technology (q = P) or a clean technology (q = C). The polluting technology generates profits of л(P) = 11. The clean technology generates profits of л(P) = 10 and doesn't have to pay tax. Assume that when the firm is indifferent between the two technologies, it chooses the clean technology. Imposing a tax of t = 1, profits of firms using polluting technology would equal profits of firms using clean technology. Let us now turn to the decisions that the governments would make if they were inde- pendently choosing whether to impose a tax or not. In the US, firms using the clean technology emit a total of 0 tonnes of CO2 emissions, while firms using the polluting technology emit a total of 900 tonnes of CO2 emissions. In…
Two neighboring countries, i = 1,2, simultaneously choose how many resources (in hours) to spend in recycling activities, n. The average benefit (n) for every dollar spent on recycling is: 7(n.n) = 10 -r +: and the (opportunity) cost per hour for each country is 4. Country i's average benefit is increasing in the resources that neighboring country i spends on his recycling because a clean environment produces positive external effects on other countries. A. Find each country's best-response function, and compute the Nash Equilibrium (NE), (ri.ri). B. Graph the best-response functions and indicate the pure strategy Nash Equilibrium on the graph. C On your previous figure, show how the equilibrium would change if the intercept of one of the countries' average benefit functions fell from 10 to some smaller number.
If a good imported from abroad creates significant pollution (a negative externality), then the market price of the good is considered to be too _______ and the importing country should set ________ tariffs. A) high; high B) low; high C) low; no D) high; no
What should mining businesses do to reduce the negative externalities? Give at least two(2) examples?
EU Subsidy No subsidy Subsidy 100, 100 500, 50 No subsidy 50, 500 250, 250 That is, if both governments subsidize their firms, the payoff to each country (net of the subsidy) is 100 million dollars. If India subsidizes India Biotech and the EU does not subsidize Zaxtra Vaccines, India Biotech will dominate the market. Hence, the payoff to India is 500 million dollars (net of the subsidy) and the payoff to the EU is 50 million dollars. If the EU subsidizes Zaxtra Vaccines and India does not subsidize India Biotech, the EU gets 500 million dollars and India gets only 50 million dollars. If neither country offers a subsidy (free trade scenario), then both countries get 250 million dollars. a. Obtain the Nash equilibria of this game. What are the associated payoffs for each country? b. If both countries cooperate, can they achieve a better outcome? Explain. C. Can you think of one way in which the two countries can ensure that the cooperative outcome is reached? India
An example of a positive externality is:a) the profit made from the sale of electric vehicles b) the penalty paid by a coal mining company after it is caught illegally dumping toxic waste into a riverc) knowledge spillovers that result when a maker of microchips invests in research and developmentd) the price paid by an electricity company for an emission certificate on the European Trading Scheme, allowing it to emit a specified level of CO2

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