1.

Table: Coal Mine Pollution

Reference: Ref 16-2 Table: Coal Mine Pollution

(Table: Coal Mine Pollution) Use Table: Coal Mine Pollution. The table shows the marginal social benefit and cost of various amounts of pollution from a coal mine. Suppose that the marginal cost from the production process itself (to the producer) is 0. At the market-determined quantity of pollution, the marginal social benefit of pollution is:

Select one:

a. $400.

b. $0.

c. $200.

d. $800.

2.

Table: Coal Mine Pollution

Reference: Ref 16-2 Table: Coal Mine Pollution

(Table: Coal Mine Pollution) Use Table: Coal Mine Pollution. The table shows the marginal social benefit and cost of various amounts of pollution from a coal mine. From the perspective of efficiency, 2 tons of pollution is:

Select one:

a. the socially optimum amount.

b. too much.

c. not enough.

d. the efficient amount.

3.

Which good BEST fits the characteristics of a private good?

Select one:

a. police protection

b. clean water

c. national defense

d. a pizza

4.

Clean water in a river is nonexcludable because:

Select one:

a. individuals ignore the effect their use has on the amount of the resource remaining for others.

b. more than one person can consume the same unit of the good at the same time.

c. it is not possible to prevent consumption by people who do not pay for it.

d. consumption is inefficiently low.

Identify five public policy issues and rank them in order of importance. For each issue explain in detail the central problem that needs to be addressed by government. The issues should be limited to the following categories listed in your syllabus: Civil rights, criminal justice, education, government finance, economic policy, social welfare policy, the environment, national security. Write it in your own words.

Money demand = 6Y-120r

Money supply = 5400

P=$1

Y=C+I+G

C=180 +.7(Y-T)

T=400

I = 100-18r+.1Y

G=400

A) Solve for equilibrium in the goods market (in terms of income)

B) Solve for equilibrium in the financial market (in terms of interest rates)

C) Solve for the equilibrium interest rate

D) At this equilibrium what is the level of consumption and investment

E) What happens if G increases by 10 to become 410? How does this impact Investment?

Consider the supply and demand curves for several markets – mineral resources, wheat, gasoline, and steel. Show how the following impacts on each of these markets would shift the supply curve, the demand curve, or both. How will the market equilibrium price and quantity change from the original equilibrium? What cause the changes? Explain in words and graphically.

a. As mineral resources are depleted, it becomes costlier to extract mineral deposits.

b. Due to floods in the Midwest, half of the wheat crop in the U.S. is destroyed. At the same time, the price of oats (a substitute for wheat) decreases due to a sharp rise in the number of farmers growing oats in response to consumer demand for health food.

c. Due to oil shortage, the federal government has decided to ration gasoline sales in the U.S. to half of current sales.

d. Steelworkers’ union has accepted a wage decrease to help steel companies through hard times.

A water treatment plant is considering implementing a new treatment technology to treat water at lower costs. They are deciding between two options: · Option A has an expected life of 24 years. It would require a one-time up-front cost of $2.25 million to install and would then yield net benefits of $180,000 at the end of each of the 24 years.

· Option B has an expected life of 24 years. It would require a one-time up-front cost of $180,000 to install and would then yield net benefits of $40,000 at the end of each of the 24 years.

a) Using a real discount rate of 5 percent: · What is the present value of the total benefits of Option A? Option B? (Show your work either here in in an attached spreadsheet.)

· What is the net present value of the total benefits of Option A? Option B? Show your work. · Which project should the treatment plant choose? Defend your answer.

b) If instead of a discount rate of 5 percent, they use a discount rate of 3%, which project should the treatment plant choose? Defend your answer.

University of Missouri, St. Louis

Economics 1002-003: Principles of Macroeconomics.

Discussion Topic 11: Great Recession and Lost Decade

1. How has the US money supply growth since 2008 resulted in an effective ceiling on real interest

rates while allowing the US inflation rate to remain low?

2. What role might the Fed policy have had in creating an effective ceiling on real interest rates, in

terms of paying interest on excess reserves (starting in 2008 for the first time)?

3. Illustrate how an effective ceiling on real interest rates in the capital market causes less private

investment and savings in equilibrium.

4. Describe how the capital market could be “deregulated” such that the ceiling on real interest

rates is eliminated and real rates resume their unregulated equilibrium.

5. What can be the effect of a ceiling on real interest rates internationally, if other countries want

their currency to remain of the same value relative to the US (so they avoid currency

appreciation and a decrease in exports).

Assume also that goods prices are sticky in the short run. Suppose the US central bank wishes to fix the exchange rate at the level before implementing the contractionary monetary policy. At the same time, the US central bank faces the Trilemma. What policy options are available to the central bank?

Suppose that nominal GDP was $9000000.00 in 2005 in Orange County California. In 2015, nominal GDP was $11750000.00 in Orange County California. The price level rose 1.00% between 2005 and 2015, and population growth was 3.75%. Calculate the following figures for Orange County California between 2005 and 2015. Give all answers to two decimals.

a. Nominal GDP growth was %.

Part 2   (1 point)

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b. Economic growth was %.

Part 3   (1 point)

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c. Inflation was %.

Part 4   (1 point)

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d. Real GDP growth was %.

Part 5   (1 point)

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e. Per capita GDP growth was %.

Part 6   (1 point)

f. Real per capita GDP growth was %.

Need a self explanatory summary on the impacts of immigrants on international trade on high tech Industries. Specify a country and explain how the immigrants have impacted the mentioned country's national & international trade.

Briefly explain Greece Crisis with ADAS / ISLM models.

The town of Cypress Creek is preparing to go to war against the American government. To do this, it is building a giant satellite laser! To build the laser, the government of the town will resort to taxation to fund its expenditure. The initial economy of Cypress Creek can be expressed by the following agents:

Consumers, C = 25 + 0.95(Y-T)

Output, Y = 5000

Government expenditures, G = 2000

Taxation, T = 2000

Investors, I = 750-125r

Markets are fully competitive and the equilibrium condition for markets are:

Goods and service market: Y =C + I + G

Financial market: I = S

When it builds the Satellite, government and taxation change to

Government expenditures, G = 4000

Taxation, T = 4000

Hank Scorpio makes another announcement "People of North Haverbrook! We must all work together in this to crush the American Government - I implore you to save you wages! Don't spend!"

m) [2 points] by how much would consumers need to reduce their Marginal propensity to consume

(MPC) such that the market clearing interest rate does not change?

n) [2 points] Who will end up paying the burden of this project? (consumers or investors? And by

how much?)

Fabulous discussion so far, the examples that you guys provided about the decisions that you had to make are great and diverse, and surely demonstrate the dilemma of scarcity and unlimited wants (utilities), as well as the dilemma of weighing costs against current or future actual (or perceived) benefits when making choices.

The society as a whole in any given country faces similar challenges due to the fact that each society has limited resources but has unlimited wants. As strange as it might sound, when countries go to large scale wars, such as WWI and WWII for example, one of the main changes in their “production” is the increase in the production of children, as well as war materials- tanks, planes, bombs, etc. During peace time and economic progress, people produce less children and the opportunity cost of having a child typically rises (more jobs for women with high pay means higher cost of having a child and/or being a stay at home mom). In such, societies alter their production process (production possibility frontier) as the resources and the wants of their people change.

Pick either a country/region outside the United States or a state, a region, or a city within the United States and discuss what is the major good or service that country, region, state, or city produces and why.

Also, what are the challenges that county, region, state, or city faces given its current resources.

3. Assume two firms are currently competing in a market. If one of the two firms wants to try to eliminate the other firm as a competitor, should it undertake a strategy of limit pricing or predatory pricing? Why? In addition, describe the conditions under which the strategy you have selected will be most successful.

Handwrite in text plz not in pic since its hard to read from and plz dont copy answers that were answered before least 2-3 paragraphs

3. George has a monopoly on burrito sales in a small town in Kansas. The burritos cost him a constant $5 each to produce. He faces following demand schedule for his product:

• Under normal monopoly conditions, how many burritos should he produce, what price should he charge, and how much profit can he expect to make?
  • Draw a graph under these assumptions showing (and calculating) producer surplus, consumer surplus, economic surplus and deadweight loss.
• If George was able to engage in perfect price discrimination, how many burritos would he produce, what would his total revenue be, and how much profit would he earn?
  • Draw a graph under these assumptions showing (and calculating) producer surplus, consumer surplus, economic surplus and deadweight loss.
• Is society better off by allowing George to perfectly price discriminate? Defend your answer.