Assume that the City Council in Prescott, Arizona is considering implementing price ceilings on rental units based on the number of bedrooms in the unit. The demand function for rental units (on a single bedroom equivalent basis) is given by QD = 120 – 4P and the supply function is given by QS = 2P, where P is price and Q is quantity. The Council is considering imposing a ceiling price on rental units of Pmax = 16.

1) Are consumers of rental-housing in Prescott well-served by this price ceiling policy? Provide a careful economic analysis in support of your claim. In particular, discuss what happens if a regulated price is set that is not equal to the equilibrium price.

Compare and contrast the “De Jure” and “De facto” political power.

“It can be argued that much of the economic backwardness in the world can be explained by the lack of mutual confidence”.

4. Use resource allocation models and explain the relationship between resource allocation models and the product life cycle.

** I am ok with simple answer 4-5 line **

“If there are no transaction costs, then an efficient outcome can be achieved in the presence of an externality if the government completely allocates tradable property rights over the externality generating activity. Furthermore, the final outcome will be invariant to the specific initial allocation of property rights that is chosen by the government.” Is this claim true, false or ambiguous? Justify your answer. (Please write as much as you can)

what proportion of the Texas budget consists of federal funds? How might the presence of this federal money affect the relationship between the state and federal governments?

Building the Supply and Demand Model Homework

1. Explain the difference between a change in the quantity demanded (Q_d) and demand (D).

A change in quantity demanded refers to a movement along the demand curve, which is caused only by a chance in price. A change in demand means that the entire demand curve shifts either left or right.

2. Explain the difference between a change in the quantity supplied (Q_s) and supply (S).

A change in quantity supplied will imply a movement along the supply curve, while a change in supply refers to a shift in the supply curve. A change in quantity supplied is usually caused by a change in the unit price while a change in supply is caused by new methods of production.

3.

Broccoli Soup (per month)
Price	Kwame	Maria	Elsa	Market Demand
$2	4	18	22
4	3	14	21
6	0	11	20
8	0	5	15
10	0	2	7
12	0	1	4
14	0	0	2
16	0	0	1

A. Using the individual demand data in the table above, determine the market demand for broccoli soup – fill in the market demand column of the table.

B. Graph the market demand curve.

C. The broccoli growers industry group launches a successful national marketing campaign highlighting the positive health effects of broccoli consumption. What will likely happen to the market demand for broccoli? Demonstrate your answer in the graph you drew for B.

4. Give 3 real world scenarios that would likely increase the demand for chickpeas.

5. Give 3 real work scenarios that would likely decrease the supply of Atlantic salmon.

6. Draw hypothetical supply and demand curves for coffee. Show how the equilibrium price and quantity will be affected by the following events. Use a separate graph to demonstrate each event. Show the equilibrium price and quantity before, and after, the event.

A. The New England Journal of Medicine publishes an article highlighting a direct correlation between coffee consumption and liver cancer.

B. The coffee growing regions of South and Central America experience optimal coffee growing weather.

C. A regional war breaks out in the coffee growing countries of East Africa.

D. Widespread media reports highlight major labor abuses in coffee growing regions around the world, including child labor, slave labor, and the widespread sexual assault of coffee plantation workers.

7. President Trump signs a law that imposes a 30% tax on oil exports from the United States.

A. Demonstrate the likely effect on the domestic oil market using supply and demand curves.

B. What we will be the likely effect on oil prices in the US?

8. Assume the individual demand and supply below represent the entire market. Answer the questions based on the following tables.

Tasting Menus Michelin Star Restaurants, Chicago (Demand Schedule - per month)
Price	Omar	Shelia	Aliyah	Market Demand
100	9	14	23
150	5	10	18
200	4	8	16
250	0	3	10

Tasting Menus Michelin Star Restaurants, Chicago (Supply Schedule - per month)
Price	Grace	Alinea	Acadia	Market Supply
100	0	2	9
150	4	4	10
200	7	10	11
250	13	15	24

A. Draw the market demand and market supply curves.

B. Label the market equilibrium price and quantity.

C. What is the excess quantity supplied at a price of $250?

D. What is the excess quantity demanded at a price of $150?

9. Explain the likely affect of the following events on the market equilibrium price and quantity:

A. Global soybean market: An infestation of the Helicoverpa armigera worm in Brazil’s soybean growing regions. Brazil is the world’s largest producer of soybeans.

B. Global toy market: A 105% increase in the minimum wage in China. China is the world’s largest manufacturer of toys.

C. Global pineapple market: Both PepsiCo and the Coca Cola company develop blockbuster pineapple flavored sodas.

D. US energy drink market: Congress imposes a 25% excise tax on energy drinks due to the adverse health effects of excessive caffeine consumption. The excise tax will be paid by the manufacturers of the drinks.

E. Local Sinha Stout (popular Sri Lankan beer) market in Poughkeepsie: Four thousand Sri Lankan immigrants settle in the city of Poughkeepsie.

F. Horn rimmed glasses local market Hyde Park: Hyde Park becomes a popular location for weekend homes for Brooklyn hipsters.

G. Fuji apple market: The price of red delicious apples increases by 67%.

H. Chef’s knife market: The demand for culinary education increases dramatically.

J. Kiwi market: Kiwi sellers raise the price of kiwis by 29%. There are no other changes in the market.

K. Wheat market: A new technology significantly increases planting productivity.

Recent efforts by the government of Ghana to improve the railway sector can be described as old wine in a new bottle. Discuss

1a. The production function for computers is q(K,L) = 7K1/3L2 where K=capital and L=labor. A firm has two units of capital (K=2) which it cannot change. A manager wants to know the marginal productivity of labor if the firm goes from 2 to 3 workers. Calculate the marginal productivity of labor for the manager. Explain your answer carefully to the manager who is not familiar with what the marginal productivity of labor means.

1b. Last year the price of bread was $2.26 and Jen bought 4 loafs of bread. This year the price of bread is $2.57 and Jen bought 3 loafs of bread. Calculate the price elasticity of demand for bread. Explain your answer to the bread delivery person.

1c. Explain why in the short run a firm may not be able to change its inputs.

When we defined the term “auteur” we said that these directors generally “have a distinctive style from film to film.” In the films that you saw how would you describe Spike Lee’s distinctive style? What do the films have in common? - Give a personal critic of the films you watched. Did you like them? Explain why you liked or disliked them

Identify the five main values/elements of the American political culture. Explain the meaning of each value. Show how these values shape our laws and influence our political and economic behavior.

3. Briefly name and describe two (quantitative) measures of competitive balance. Which measure do you think best captures the concept, and why?

4.Explain the link between diminishing returns and competitive balance.

5.Explain the invariance principle, i.e. why, with or without Free Agency, Babe Ruth (perhaps history’s most famous baseball player) was destined to play for the Yankees.

Construct an original numerical example of a Ricardian model in which one country has an absolute advantage in the production of both goods.

1. Make an assumption about the amount of labor resource available in each country, then draw each country’s PPF.
2. Will trade be mutually advantageous in your example? If not, why not? If trade is mutually advantageous, give an example of one international terms of trade that would make trade mutually advantageous.

A neighboring city looks identical in every way (except each house in the neighboring city requires only half the electricity and only ¼ of the water is produced for use compared with the city in the above questions – which sacrifices 1 unit of water for 1 unit of electricity). Use comparative advantage to determine which city will supply water and which will supply electricity. Estimate the price range of electricity in terms of water.

  Durable goods                                          400

                                      Non-resident investment                                 300

                                      Federal purchase of goods                               300

                                      Exports                                                            500

                                      State and local purchases of goods                250

                                      Residential investment                                        5

                                      Imports                                                            150

                                      Change in business inventories                        -25

                                      Nondurable goods                                          600

                                    Depreciation                                                       50

                                    Net factor income from abroad                          30

Determine:

i)                Personal consumption expenditures

ii)              The value for gross private domestic investment

iii)             The value of Net Exports

iv)             The value of government spending in

v)               The value of gross domestic product (GDP)

vi)             The value of GNP

vii)           The value of NNP

2. In an economy, Y (national income) + C (Consumption) + I (investment). If consumption + $50m + 0.75Y, planned investment = $180m and national income = $800m, realised investment will be:

$50m

$100m

$200m

$300m