MICROECONOMICS-MINDTAP (1 TERM)
13th Edition
ISBN: 9780357686942
Author: Arnold
Publisher: CENGAGE L
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Chapter 18.4, Problem 1ST
To determine
Calculate socially optimal or efficient outcome.
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Select a real-world case situation relevant to credit analysis and lending in Guyana. Use this case which you either know about already or have identified through research and address the following questions in essay format: i. Outline and discuss what “triggered” the regulatory body to intervene? ii. How effective do you think the response was to such a crisis? iii. Outline and discuss two ways that could be used to strengthen the current regulatory environment?
Home can produce a maximum of 400 apples or a maximum of 600 bananas.Foreign can produce a maximum of 160 apples or a maximum of 800 bananas.(a) Graph and label Homes PPF. Label each axis and the slope. Use numbers.1(b) In the
absence of trade, what is Homes autarky price of apples in terms of bananas?(c) Graph and label Foreigns production possibility frontier. Use numbers and label the slope.(d) Graph the world relative supply curve. Use numbers.23. (8 pts - RM) Now
suppose world relative demand for apples takes the following form:Demand for apples/demand for bananas - price of bananas/price of apples. That is, RDA = Pbananas Papples(a) Graph the relative demand and relative supply curves on the world
market diagram. Use numbers(b) What is the equilibrium (world) relative price of apples? (c) Show that both Home and Foreign gain from Trade and describe the pattern of trade.
A village has six residents, each of whom has accumulated savings of $100. Each villager can use this money either to
buy a government bond that pays 18 percent interest per year or to buy a year-old llama, send it onto the commons to
graze, and sell it after 1 year. The price the villager gets for the 2-year-old llama depends on the quality of the fleece It
grows while grazing on the commons. That in turn depends on the animal's access to grazing, which depends on the
number of llamas sent to the commons, as shown in the following table:
Number of
11amas on
the
commons
Price per 2-
year-old
11ama ($)
1
125
2
119
3
116
4
113
5
6
111
109
The villagers make their investment decisions one after another, and their decisions are public.
a. If each villager decides Individually how to Invest, how many llamas will be sent onto the commons, and what will
be the resulting village Income?
Number of llamas: [ 20
Instructions: Enter your response as a whole number.
Village Income: $
110
b. What is…
Chapter 18 Solutions
MICROECONOMICS-MINDTAP (1 TERM)
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