Required Reading:

Ward, M, and Chrysanthos, N 2020, ‘’Higher than usual demand’ for toilet paper in NSW supermarkets’, Sydney Morning Herald, 26 June.

'Higher than usual demand' for toilet paper in NSW supermarkets

Premier Gladys Berejiklian has asked shoppers to remain calm after reports of bare toilet paper shelves in NSW following the reinstatement of product limits in Victorian supermarkets.

Toilet paper was in short supply at Coles and Woolworths at Roselands in Sydney's south-west on Thursday, the Herald has been told.

Posting on social media, shoppers also complained of empty shelves at Coles Merrylands and Woolworths Leichhardt in Sydney, as well as Coles Toronto in Lake Macquarie.

On Wednesday afternoon Coles, Woolworths and IGA said they would reinstate product limits for toilet paper, hand sanitiser, paper towels, flour, sugar, pasta, minced meat, long-life milk, eggs and rice at all their Victorian stores.

Coles, on Friday, reintroduced one-pack purchase limits for toilet paper and paper towels across all of its stores, including Coles online.

"We ask that customers continue to shop normally so that everyone can have access to the food and groceries they need," a spokesperson said.

Costco, which has stores at Marsden Park, Crossroads and Auburn, has also reintroduced a one-per-person limit on its toilet paper packs nationwide.

It is believed the panic buying, which was witnessed earlier in the pandemic, is being caused by an uptick in coronavirus cases in Melbourne over the past week.

Victoria reported its ninth day of double-digit case growth on Thursday, with 33 new cases.

NSW Premier Gladys Berejiklian said on Friday that shoppers need to "stay calm" as there was no need for items to be stockpiled.

"Please continue to maintain your calm; continue to do what you've been doing – NSW is doing incredibly well," Ms Berejiklian said, adding that she didn't "blame" people for being concerned as product limits were reintroduced in Victoria amid an uptick in cases.

"We all have to be on our guard, but we certainly, certainly don't need to change our normal buying habits. So please continue with your normal buying habits, there's nothing to worry about."

A Woolworths spokesperson said they had seen "higher than usual" demand for toilet paper in parts of NSW, and were monitoring the situation.

“We’ve seen pockets of higher-than-usual demand for toilet roll across parts of NSW [on Thursday], but not anywhere near the levels we saw in Victoria," the spokesperson said.

"We’ll keep a close eye on demand over the coming days. We continue to ask customers to buy only what they need, as there is plenty of stock to replenish our shelves.”

Question :

1. Evaluate the outcomes in the market for toilet paper in terms of Pareto efficiency, fairness, and the effect on the consumer surplus, producer surplus, and deadweight loss if:

(a) no restrictions are imposed by supermarkets.

(b) purchase-limit restrictions are imposed by supermarkets.

Include appropriate diagrams to illustrate your answers.

2. Suggest and explain two other ways the problem in this market could be solved. Evaluate these alternative solutions in terms of Pareto efficiency and fairness.

As a part of the federal Clean Air Act Amendments Congress established a national goal of preventing future and resolving existing regional haze in national parks and wilderness areas when the visibility impairment results from manmade air pollution. The law requires states to submit implementation plans to the United States Environmental Protection Agency (EPA). The implementation plans must include identifying major industrial sources of air pollution that have caused or contributed to visibility impairment in national park and wilderness areas.

In the state implementation plan, any facility identified as a major source of air pollution must reduce air pollution by installing the best available retrofit technology (BART)—as determined by the state. To determine the BART, the law requires the following factors be considered: (1) the technology available, (2) the costs of compliance, (3) the energy impacts and non-air quality environmental impacts of compliance, (4) any pollution control equipment currently being used at the source, (5) the remaining useful life of the source, and (6) the degree of improvement in visibility reasonably anticipated to result from the use of such technology. The law requires the EPA Regional Administrator—“after an opportunity for a public hearing”—to approve or disapprove a state’s determination of the BART and the emission limits for any identified source. The legislative history for the Clean Air Act doesn’t indicate what type of hearing is required or the specific procedures to be used in the “public hearing.”

A party may request the EPA Administrator reconsider the approval or disapproval of the state’s BART determination, but that request for reconsideration doesn’t extend the time for filing a petition for judicial review or postpone the effectiveness of the action. Any Petition for Judicial Review of the BART determination must be filed in the District of Columbia Court of Appeals within 60 days of the Regional Administrator’s decision of the approval or disapproval of the BART determination.

If a facility fails to install the air pollution control measures required by the BART determination by the deadline set forth in the determination, the EPA can bring an action in court to enforce the BART determination, which could include imposing a substantial fine.

The state of West Dakota has identified the Poison Valley Power Plant—a coal-fired power plant in West Dakota—as a major source of air pollution contributing to visibility impairment in White Hills National Park. The West Dakota Department of Natural Resources issued a determination that the best available retrofit technology (BART) for the Poison Valley Power Plant is Selective Noncatalytic Reduction (SNCR) technology and set an emission limit of 0.20 lbs/MMBtu (pounds per million British thermal units).

In its determination, the state rejected a proposal by the Stormy Plateau Tribe, an Indian tribe with a reservation located within a mile of the Poison Valley Power Plant, and an environmental group, Citizens Advocating Renewable Energy (CARE) to use Selective Catalytic Reduction (SCR) technology—a more costly but more effective emission-reducing technology. The state also rejected the Poison Valley Power Plant’s proposal, which was that no additional emissions controls should be installed because the new pollution control equipment would be too expensive and could close the plant. The basis for the state’s BART determination was that additional emission controls were required because Poison Valley Power Plant was a substantial contributor to the haze problem in White Hills National Park. In terms of the choosing SNCR over SCR, the state determined the estimated 5 percent increase in visibility improvement using SCR technology was outweighed by the increased cost of SCR. State documents estimated SNCR technology would cost about $4.3 million per year compared to $16.3 million per year for SCR technology.

The Region 25 Office of the United States EPA issued the attached notice to interested parties on July 15, 2017. The notice was posted on the EPA Region 25 Facebook page and the notice was emailed to all the parties who participated and offered comments to the state of West Dakota DNR in its BART proceeding.Poison Valley Power Plant, Stormy Plateau Tribe, and CARE all opposed West Dakota’s determination of the BART (for different reasons). Each objected to the “open-house” process outlined in the notice and contended a trial-type hearing was required by the US Constitution and federal APA to challenge West Dakota’s determination of the BART and the emission limits. In addition, Poison Valley Power Plant, Stormy Plateau Tribe and Care requested the underlying data used by West Dakota officials in making its BART determination be disclosed and an opportunity to cross-examine a DNR official about the data. Regional Administrator Giva Hoot denied the requests for a trial-type hearing, disclosure of data, and cross-examination. The parties provided written and oral comments at the open house. Regional Administrator Giva Hoot approved West Dakota’s determination that SNCR technology is the BART for Poison Valley Power Plant and approved the 0.20 lbs/MMBtu limit on NOx, but she offered no reasons for her action. Instead, on October 1, 2017, she mailed a letter to all those participating in the open house and posted a statement on www.facebook.com/EPA/Region25 stating she had the discretion to approve or deny the BART determination and no law or rule required her to give her reasons. The statement simply

July 15, 2017                          NOTICE

ENVIRONMENTAL PROTECTION AGENCY ANNOUNCES PROPOSED BEST AVAILABLE RETROFIT TECHNOLOGY (BART) DETERMINATION, OPEN HOUSE, AND REQUEST FOR PUBLIC COMMENT

The Region 25 Office of the United States Environmental Protection Agency (EPA) requests public comment on a proposed state implementation plan for implementing Best Available Retrofit Technology (BART) at Poison Valley Power Plant located near Peabody, West Dakota. The Clean Air Act’s Regional Haze Rule requires the use of BART at older coal-fired power plants like PVPP to reduce haze and improve visibility in nearby national parks and wilderness areas.

EPA is proposing to approve West Dakota’s determination that Selective Non-catalytic Reduction (SNCR) technology is the BART for Poison Valley Power Plant and its limits on emissions of nitrogen oxide (NOx) is set at 0.20 lbs/MMBtu (pounds per million British thermal units), which must be implemented by January 1, 2020.

EPA is holding an open house on the proposal and an opportunity for the public to comment on September 1, 2017, at the Peabody High School in Peabody, West Dakota. Any person may provide written comments and/or oral comments regarding our proposal at the open house.

If you have questions about the public hearings or how to submit comments, please contact Giva Hoot, EPA Region 25 Administrator at 415-947-4139, or at [email protected]. Please bring this notice to the attention of all persons who may have an interest in our proposal.

Posted on www.facebook.com/EPA/Region25 and sent to interested parties

GIVA HOOT

Region 25 Administrator

Poison Valley Power Plant, Stormy Plateau Tribe, and CARE all opposed West Dakota’s determination of the BART (for different reasons). Each objected to the “open-house” process outlined in the notice and contended a trial-type hearing was required by the US Constitution and federal APA to challenge West Dakota’s determination of the BART and the emission limits. In addition, Poison Valley Power Plant, Stormy Plateau Tribe and Care requested the underlying data used by West Dakota officials in making its BART determination be disclosed and an opportunity to cross-examine a DNR official about the data. Regional Administrator Giva Hoot denied the requests for a trial-type hearing, disclosure of data, and cross-examination. The parties provided written and oral comments at the open house. Regional Administrator Giva Hoot approved West Dakota’s determination that SNCR technology is the BART for Poison Valley Power Plant and approved the 0.20 lbs/MMBtu limit on NOx, but she offered no reasons for her action. Instead, on October 1, 2017, she mailed a letter to all those participating in the open house and posted a statement on www.facebook.com/EPA/Region25 stating she had the discretion to approve or deny the BART determination and no law or rule required her to give her reasons. The statement simply concluded “West Dakota’s determination is approved.”

In individual petitions for judicial review filed in federal court on November 1, 2017, Poison Valley Power Plant, Stormy Plateau Tribe, and CARE all challenged Regional Administrator Giva Hoot’s decision to approve West Dakota’s BART determination and emission limit for the Poison Valley Power Plant and the process used to approve the determination as violating the Constitution and the federal APA. None of the parties requested reconsideration of the decision before filing their lawsuits.

In its complaint, Poison Valley Power Plant alleged the approval violated the Clean Air Act and was arbitrary and implementing SNCR technology would cause economic hardship for the company.

In its complaint, Stormy Plateau Tribe alleged that the approval violated the Clean Air Act, just rubber-stamped the state’s action, and ignored the evidence that Poison Valley Power Plant’s mercury emissions were causing health problems for tribal members, which would be reduced by implementing Selective Catalytic Reduction (SCR) technology.

CARE’s members all reside in South Dakota and its complaint alleged that the EPA’s selection of SNCR technology as the BART for Poison Valley Power Plant might be used as precedent in its upcoming review of South Dakota’s state implementation plan. CARE alleged its members are concerned about the haze problems in Mount Rushmore and Badlands National Parks in South Dakota and contend that only SCR technology will fix the pollution problems with the South Dakota power plants.

You are the judge and must write a decision analyzing the legality of EPA Regional Administrator Giva Hoot’s actions, and in doing so, address the following points (make sure you define and explain the important terms and principles mentioned below):

Assume the decision can be reviewed by the court in answering all the questions below.

Applying the principles of Citizens to Preserve Overton Park v. Volpe, explain what you—as the reviewing judge—would do to overcome the failure of the EPA Regional Administrator to provide any justification for her decision and why??

1) Which of the following best describes why Charles Babbage is sometimes called the "Father of Computing"?

a. Although Babbage's machines did not have all the characteristics of modern computers, their design included a number of key characteristics of modern computers; this was a major conceptual step in clarifying what a computer should be.

b. Even though they primarily consisted of mechanical parts, Babbage's machine was the first to include at least some electronic components.

c. There was a gradual but definite progression of computational machines from his machines to the first modern computers. That is, soon after his machines were publicized, others built better machines based on them, and then others built still better machines based on those machines, until eventually the first modern computers were created.

d. Although Babbage's machines did not have many of the characteristics of a modern computer, he nonetheless was able to use them to do a number of scientific calculations mechanically, and with great speed and reliability.

2) Which one of the following best describes the most important contributions of Ada Lovelace?

a. She was a co-designer of Babbage's Difference Engine and Analytical Engine. That is, she and Babbage worked closely together and made roughly equal contributions to the design of these machines.

b. She designed and ran programs that ran on Babbage's Difference Engine and Analytical Engine. Some of these programs did numeric computations, but others did various computations involving text.

c. She designed and ran programs that ran on Babbage's Difference Engine and Analytical Engine. These programs did numeric computations.

d. She wrote works about Babbage's machines, and these works contained many important ideas such as algorithms for certain computations.

3) The SABRE airline reservation system, although conceived in 1953, took over 10 years to become fully operational. Which one of the following was not a major reason for this long amount of time?

a. The early computer industry did not have productivity tools such as a large number of high-level languages.

b. It took IBM and American Airlines a few years to commit to the project.

c. SABRE was a large, real-time (or near real-time) system, and such systems take time to complete.

d. SABRE was the first large system IBM worked on, and so the system development took longer than expected.

4) Which one of the following questions is true about Remington-Rand?

a. It went bankrupt and disappeared in the 1970s.

b. After some mergers it eventually became part of Unisys.

c. It merged with Burroughs, retained its name, and still is around today as Remington-Rand (but is a much smaller and less important company).

d. It was bought by IBM in the 1970s.

5) Which one of the following is a reason the IBM System/360 made it difficult for other computer companies to compete with IBM?

a. The System/360 had advanced time-sharing capabilities.

b. The System/360's operating system was delivered on time and under budget.

c. The System/360 was significantly more technically advanced compared to other companies' computers.

d. The System/360 was a family of compatible computers, not just a single computer.

6) Which one of the following best describes the strategies DEC and Control Data used to compete with IBM?

a. Both tried to compete on the low end of the computer range, i.e., with minicomputers.

b. DEC tried to compete on the low end of the computer range, with minicomputers, and Control Data tried to compete on the high end, with supercomputers.

c. Control Data tried to compete on the low end of the computer range, with minicomputers, and DEC tried to compete on the high end, with supercomputers.

d. Both tried to compete on the high end of the computer range, i.e., with supercomputers.

7) Which one of the following best describes the eventual fate of minicomputer companies such as DEC and Data General?

a. These companies are still around, although they are nowhere near as large or successful as they about 50 years ago.

b. These companies are no longer around (they were bought by other companies) because the minicomputer market became less profitable with the eventual rise of personal computers.

c. These companies are still around, and still reasonably successful, today.

d. These companies are no longer around (they were bought by other companies) because IBM managed to become dominant in the minicomputer market.

8) Which of the following are true about "pre-computer" history? Zero, one, or more than one may be true.

a. IBM, Burroughs, DEC, Control Data, and NCR were all companies that existed before the modern computer era, and that made office machinery the.

b. One reason the Jacquard loom is important to computing is it could follow a set of previously created instructions, rather than being entirely manual.

c. In the 19th century, a "computer" was a human who was employed to do arithmetic calculations.

d. Babbage complete his Difference Engine, but not his Analytical Engine.

9) Which of the following are true about the ENIAC? Zero, one, or more than one may be correct.

a. The ENIAC had many, although not all, characteristics of a modern computer.

b. Almost all computer historians consider the ENIAC the "first true computer."

c. The ENIAC was the first machine to use transistor technology.

d. Mauchly and Eckert, in addition to being the main designers of the ENIAC, also did the majority of the programming.

10) Which of the following were created or significantly developed at Xerox PARC? zero, one or more than one may be the correct answers

a. Ethernet

b. The UNIX operating system.

c. The CICS software.

d. The graphical user interface.

11) Which of the following are true about the Charles Babbage Institute collection? Zero, one, or more than one might be true.

a. The Babbage collection contains a number of oral histories.

b. The Babbage collection contains a number of photographs and films.

c. The Babbage collection contains some physical artifacts such as certain old computer components.

d. The Babbage collection contains resources from or about a number of companies, including Burroughs and Control Data Corporation.

1. A profit-maximizing, monopolistically competitive car wash washes 40 cars per day, and its total cost $200 and currently makes an economic profit of $280. In the long run, everything else equal, the
   a.   car wash will wash less than 40 cars per day.
   b.   car wash will charge more than $12 per wash.
   c.   car wash will need to hire new workers to wash more cars.
   d.   car wash will wash more than 50 cars per day.

2. For a competitive firm, if at least some portion of its short-run average cost curve lies below the price of the product, we can conclude that the firm
   a.  is earning zero economic profits.
   b.  is incurring short-run losses.
   c.  is going to shut down.
   d.  is earning a profit at the profit maximizing output level.

3. If stock exchanges did not exist,
   a.   the economy’s resources could be more efficiently allocated among firms.
   b.   the risk to the investor of buying stocks would be much greater.
   c.   investment banks would no longer play a role in handling stocks.
   d.   there would be no organized way for firms to issue stock.

4. A “specialist” is a
   a.   stockbroker who specializes in the “third market.”
   b.   person who works on the floor of the New York Stock Exchange and specializes in certain stocks.
   c.   stockholder who finds buyers and sellers for specific stocks, but also operates outside of specific stock markets.
   d.   stockbroker who operates only in a particular regional stock market.

5. Suppose that we learn that hotels in Los Angeles generally operate with an average vacancy rate of 15 percent (in other words, 85 percent of the hotel rooms are filled with guests). Given this information about excess capacity, we would judge this market to be
   a.  a perfectly competitive market.
   b.  a monopoly.
   c.  a monopolistically competitive market.
   d.  an oligopoly.

6. A monopolistically competitive firm
   a.   is always a retail establishment.
   b.   has more monopoly power in the long run than does a perfectly competitive firm.
   c.   tries to differentiate its product from competitors’ products.
   d.   faces a perfectly elastic demand curve for its product.

Classifications on Balance Sheet

The current balance sheet of J. J. Arvesen Company contains the following major sections:

1. Current assets
2. Long-term investments
3. Property, plant, and equipment
4. Intangible assets
5. Other assets
6. Current liabilities
7. Long-term liabilities
8. Contributed capital
9. Retained earnings
10. Accumulated other comprehensive income

The following is a list of accounts in random order. Using the letters A through J, indicate in which section each account would most likely be classified. If an account does not belong under one of the sections listed, select "Not under any of the choices" from the classification drop down box. For all accounts, indicate if the account is a contra account or an account that would normally be deducted on the balance sheet by selecting "yes" from the second drop down box, otherwise select "no".

Shown as follows is a segmented income statement for Drexel-Hall during the current month.

All stores are similar in size, carry similar products, and operate in similar neighborhoods. Store 1 was established first and was built at a lower cost than were Stores 2 and 3. This lower cost results in less depreciation expense for Store 1. Store 2 follows a policy of minimizing both costs and sales prices. Store 3 follows a policy of providing extensive customer service and charges slightly higher prices than the other two stores.

Top management of Drexel-Hall is considering closing Store 3. The three stores are close enough together that management estimates closing Store 3 would cause sales at Store 1 to increase by $84,000, and sales at Store 2 to increase by $150,000. Closing Store 3 is not expected to cause any change in common fixed costs.

Compute the increase or decrease that closing Store 3 should cause in:

a. Total monthly sales for Drexel-Hall stores.

b. The monthly responsibility margin of Stores 1 and 2.

c. The company's monthly income from operations.

Your employer is considering a capital project that involves installing a new manufacturing line at a cost of $1,880,000. The line will be installed area of the factory that was refurbished in 2017. At that time, the refurbishment cost $950,000. If it is not employed by this project, that area of the factory will remain unused. The new manufacturing line, if built, will be depreciated on a straight-line basis over five years, to a salvage value of $0. If implemented, the project will cause an immediate increase in Inventory of $260,000. It will also cause immediate increases in Accounts Receivable of $290,000, Accounts Payable of $160,000, and Long-Term Debt of $1.2million.

If implemented, the project is expected to generate annual sales of $3,375,000 by the end of the first year. Sales are expected to increase 6% per year. COGS expense is expected to be of $1,599,600 during the first year. Thereafter, COGS is expected to remain at a constant percentage of Sales. Because operating efficiency is expected to improve each year, SG&A expense is expected to remain at $950,000 for each of the five years of the project. At the end of the project’s five-year life, production will cease, and the manufacturing line will be sold for an estimated $140,000. At that time, Inventory, Accounts Receivable and Accounts Payable will return to their pre-project levels.

If the project is implemented, it will likely cannibalize sales of an existing product. The net impact of the cannibalization is expected to be a $225,000 annual reduction in pre-tax profits.

Your employer’s tax rate is 21%. The firm has 2 million shares of common stock outstanding. The firm requires a 14% rate of return on capital projects.

Prepare a discounted cash flow analysis to determine whether your employer should implement this capital project. Your analysis should reveal answers to each of the following questions. Highlight the cells that answer the following questions:

1. What is the initial investment amount (Year 0)?
2. What are the total cash flows each year (Years 1-5)
3. What is the NPV?
4. What is the IRR?

Please include all the formulas used in answer

(Determining relevant cash? flows)??Landcruisers Plus? (LP) has operated an online retail store selling? off-road truck parts. As the name? implies, the firm specializes in parts for the venerable Toyota FJ40 that is known throughout the world for its durability and offroad prowess. The fact that Toyota stopped building and exporting the FJ40 to the U.S. market in 1982 meant that FJ40 owners depended more and more on? re-manufactured parts to keep their beloved? off-road vehicles running. More and more FJ40 owners are replacing the original inline? six-cylinder engines with a modern? American-built engine. The engine replacement requires mating the new engine with the Toyota drive train.

?LP's owners had been offering engine adaptor kits for some time but have recently decided to begin building their own units. To make the adaptor kits the firm would need to invest in a variety of machine tools costing a total of

?$600,000.LP's management estimates that they will be able to borrow $340,000

from the? firm's bank and pay 8

percent interest. The remaining funds would have to be supplied by? LP's owners.

The firm estimates that they will be able to sell? 1,000 units a year for

?$1,400 each. The units would cost

?$1,000 each in cash expenses to produce? (this does not include depreciation expense of

?$60,000 per year or interest expense of

?$27,200?). After all? expenses, the firm expects earnings before interest and taxes of $340,000.

The firm pays taxes equal to 38 percent, which results in net income of $183,600 per year over the

10?-year expected life of the equipment.

.??The financing cost associated with the

?$340,000 loanshould not or should be incorporated into the analysis of cash flow

B) The annual free cash flow LP should expect to receive from the investment in years 1 through 10 is?

b.??The the anticipated NPV of the investment is (Round to the nearest? dollar.)

A city is deciding whether to pay a locally owned construction firm to build a new bridge. The city would finance the construction by borrowing. They would raise local property taxes to collect $20M more per year than they would without the new bridge. (M stands for million.) The extra $20M per year would repay the loan and pay for maintenance and all other costs of operating the bridge during its 50 year lifetime. The government expects that the demand curve for crossings over the bridge will be linear, with a choke price of $8. They plan to charge no toll and expect that there will be 10M crossings over the bridge per year and almost never any traffic congestion. They expect that only city residents will cross the bridge. Assume that the government's expectations are correct. a.[4] Estimate the total consumer surplus that drivers will get by crossing the bridge during a typical year. Show how you get your answer. b.[5] Estimate the average cost of the service provided by the bridge when no toll is charged. Show how you get your answer. c.[5] The local construction firm could have borrowed money and used it to pay its cost of building the bridge. Then it could have operated the bridge and charged a profit-maximizing toll of $4.00 per crossing. There would be 5M crossings of the bridge per year in that case. The firm would have paid $20M per year to maintain the bridge, collect the tolls, and repay the loan. Estimate the firm's annual profit from this project. d.[6] The firm's profit in part c is much bigger than the government's profit if it operates the bridge without charging a toll. Explain why the city residents (including the firm's owner) would benefit much more if the city built and operated the bridge than if the firm operated it as in part c. Why does the firm's higher profit not matter for this conclusion?  

Shown as follows is a segmented income statement for Drexel-Hall during the current month.

All stores are similar in size, carry similar products, and operate in similar neighborhoods. Store 1 was established first and was built at a lower cost than were Stores 2 and 3. This lower cost results in less depreciation expense for Store 1. Store 2 follows a policy of minimizing both costs and sales prices. Store 3 follows a policy of providing extensive customer service and charges slightly higher prices than the other two stores.

Top management of Drexel-Hall is considering closing Store 3. The three stores are close enough together that management estimates closing Store 3 would cause sales at Store 1 to increase by $56,000, and sales at Store 2 to increase by $116,000. Closing Store 3 is not expected to cause any change in common fixed costs.

Compute the increase or decrease that closing Store 3 should cause in:

a. Total monthly sales for Drexel-Hall stores.

b. The monthly responsibility margin of Stores 1 and 2.

c. The company's monthly income from operations.