Question
In: Economics
A large share of the world's supply of diamonds comes from Russia and South Africa....
A large share of the world's supply of diamonds comes from Russia and South Africa. Suppose that the marginal cost of mining diamonds is $1000 per diamond, and the demand for diamonds is described by the following schedule:
a. if there were many suppliers of diamonds, what would be the price and quantity?
b. If there was only one supplier of diamonds, what would be the price and quantity?
c. If Russia and South Africa formed a cartel, what would be the price and quantity, countries split the market evenly, what would be South Africa's production and profit? What would happen to South Africa's profit if it increased its production by 1000 while Russia stuck to the cartel agreement?
d. Use your answer to part (c) to explain why cartel agreements are often not successful
Solutions
Expert Solution
answer d)
Thus cartels are unstable, bcoz each member nation or firm has profitable incentives to deviate, & the other members who still Cooperate gets worse off, & also wanted to deviate
Rahul Sunny answered 2 years agoRelated Solutions
A large share of the world supply of diamonds comes from Russia and South Africa. Suppose...
A large share of the world supply of diamonds comes from Russia and South Africa. Suppose that the marginal cost of mining diamonds is constant at $2,000 per diamond, and the demand for diamonds is described by the following schedule:
Price Quantity (Dollars) Quantity(Diamonds)
8000 2000
7000 3000
6000 4000
5000 5000
4000 6000
3000 7000
2000 8000
1000 9000
If there were many suppliers of diamonds, the price would be _____ per diamond and the quantity sold would be...
A large share of the world supply of diamonds comes from Russia and South Africa. Suppose...
A large share of the world supply of diamonds comes from Russia
and South Africa. Suppose that the marginal cost of mining diamonds
is constant at $2,000 per diamond, and the demand for diamonds is
described by the following schedule:
Price
Quantity
(Dollars)
(Diamonds)
8,000
2,000
7,000
3,000
6,000
4,000
5,000
5,000
4,000
6,000
3,000
7,000
2,000
8,000
1,000
9,000
If there were many suppliers of diamonds, the price would beper
diamond and the quantity sold would be
diamonds.
If...
A large share of the world supply of diamonds comes from Russia and South Africa. Suppose...
A large share of the world supply of diamonds comes from Russia
and South Africa. Suppose that the marginal cost of mining diamonds
is constant at $3,000 per diamond, and the demand for diamonds is
described by the following schedule:
Price
Quantity
(Dollars)
(Diamonds)
8,000
3,000
7,000
4,000
6,000
5,000
5,000
6,000
4,000
7,000
3,000
8,000
2,000
9,000
1,000
10,000
If there were many suppliers of diamonds, the price would be
________ per diamond and the quantity sold would be...
A large share of the world supply of diamonds comes from Russia and South Africa. Suppose...
A large share of the world supply of diamonds comes from Russia
and South Africa. Suppose that the marginal cost of mining diamonds
is constant at $3,000 per diamond, and the demand for diamonds is
described by the following schedule:
Price (Dollars)
Quanity (Diamonds)
8,000
3,000
7,000
4,000
6,000
5,000
5,000
6,000
4,000
7,000
3,000
8,000
2,000
9,000
1,000
10,000
1. If there were many suppliers of diamonds, the price
would be $____??? per diamond and the quantity sold would...
1. A large share of the world supply of diamonds comes from Russia and South Africa....
1. A large share of the world supply of diamonds comes from
Russia and South Africa. Suppose that the mar- ginal cost of mining
diamonds is constant at $1,000 per diamond and the demand for
diamonds is described by the following schedule:
Price Quantity
$8,000 5,000 diamonds 7,000 6,000
6,000 7,000
5,000 8,000
4,000 9,000 3,000 10,000 2,000 11,000 1,000 12,000
a. If there were many suppliers of diamonds, what would be the
price and quantity?
b. If there were...
There is a large increase in the global demand for diamonds, of which South Africa is...
There is a large increase in the global demand for diamonds, of
which South Africa is the biggest producer. At the same time, the
central bank of South Africa cuts the interest rate. Explain (with
appropriate diagrams) the effects of the above events on: (a) The
demand for rand (South African currency) (b) The supply of rand (c)
The exchange rate of the rand against the U.S. dollar
a large share of the growing expenditures in South Africa goes toward the remuneration of employees....
a large share of the growing expenditures in South
Africa goes toward the remuneration of employees. explain how
unbalanced productivity growth. according to baumol unbalanced
productivity growth model. affect government expenditures and
briefly comment on its relevance to south Africa
Question 5 [10]A large share of the growing expenditure in South Africa goes towards the remuneration...
Question 5 [10]A large share of the growing expenditure in South
Africa goes towards the remuneration of employees (the so-called
wage bill). Explain how unbalanced productivity growth (According
to Baumol’s unbalanced productivity growth model) affects
government expenditure, and briefly comment on its relevance to
South Africa.
Subject: Government economics 20A
Discuss franchising as an alternative for entrepreneurs in South Africa. Do so from the perspective of...
Discuss franchising as an alternative for entrepreneurs in South
Africa. Do so from the perspective of the franchisor and the
franchisee. 30 MARKS
Who are the illegal miners in South Africa? They are often illegal immigrants, largely from Zimbabwe,...
Who are the illegal miners in South Africa? They are often
illegal immigrants, largely from Zimbabwe, Mozambique, Lesotho or
other central and southern African nations that come to South
Africa in search of striking it rich, or at the very least, making
a decent living. In South Africa, the illegal miners are often
referred to as the Zama Zamas, a term that means “trying your
luck”. These immigrants come to South Africa to earn a living with
the hopes of...
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