## 16 . Individual Problems 20-4 Suppose that every driver faces a 5% probability of an automobile accident every year. An accident will, on average, cost each driver \$12,000. Suppose there

16 . Individual Problems 20-4 Suppose that every driver faces a 5% probability of an automobile accident every year. An accident will, on average, cost each driver \$12,000. Suppose there are two types of individuals: those with \$60,000.00 in the bank and those with \$3,000.00 in the bank. Assume that individuals with \$3,000.00 in the bank declare bankruptcy if they get in an accident. In bankruptcy, creditors receive only what individuals have in the bank. Assume that both types of individuals are only slightly risk averse. In this scenario, the actuarially fair price of full insurance, in which all damages are paid by the insurance company, is \$ __________ Assume that the price of insurance is set at the actuarially fair price. At this price, drivers with \$3,000.00 in the bank likely (WILL OR WILL NOT) buy insurance, and those with \$60,000.00 in the bank likely (WILL OR WILL NOT) buy insurance. (nt: For each type of driver, compare the price of insurance to the expected cost without insurance.) Suppose a state law has been passed forcing all individuals to purchase insurance at the actuarially fair price. True or False: The law will affect only the behavior of drivers with \$3,000.00 in the bank.

## Question 5 (20 points) Consider the market for good X represented in the diagram below. Initially, the equilibrium price for good X is \$6 per unit, and the equilibrium quantity

Question 5 (20 points) Consider the market for good X represented in the diagram below. Initially, the
equilibrium price for good X is \$6 per unit, and the equilibrium quantity is 6 units of good X . The
government now puts a \$4 tax. (30 points)
Price \$12
10
Price paid = \$8
B
C
D
10 12
Quantity
a. Use the figure above to fill the following table
No TAX
With Tax
Difference
Change
(increased or
decreased or
remained the
same)
Consumer Surplus
Producer Surplus
Social (Total) Surplus
Government Tax Revenue
none
BIC
BC
increased
b. Did the \$4 tax create any deadweightloss (DWL)? if so, explain why a tax creates DWL and also show
the areas that represent the DWL due to the tax on the figure above.
c. Given the \$4 tax, what would be the size of DWL, if the supply was more elastic than the supply
curve in the figure? (Assume that there no change in the elasticity level of the demand curve)
Given the \$4 tax, what would be the size of DWL, if the demand was less elastic than the demand
curve in the figure? (Assume that there no change in the elasticity level of the supply curve)

## well. s fixed costs are a truck, trailer and some equipment that has been rented for four more months at a cost of \$1500. If he continues operating over these

well.  s fixed costs are a truck, trailer and some equipment that has been rented for four more months at a cost of \$1500.  If he continues operating over these four months, the cost of labor (both his own and his employees) will be \$4,000.  Russell is worried about whether to keep the business going.  If he expects to earn \$6,000 in total revenue over the next four months, should he keep operating?  Explain.  if he expects to earn \$7,000 over the next four months?  Explain.  if he expects to earn \$8,000 over the next four months?  Explain.

## QUESTION 9 10 points If 36 pies and 8 cakes are to be optimally produced in the bakery, what should Noel produce? Q’a. Noel should produce 30 pies and 0

QUESTION 9
10 points
If 36 pies and 8 cakes are to be optimally produced in the bakery, what should Noel produce?
Q’a. Noel should produce 30 pies and 0 cakes.
O’b. Noel should produce O pies and 30 cakes
O c. Noal should produce 30 pies and 30 cakes.
O d. Noel should produce 15 ples and 15 cakes.
QUESTION 10
to points
Suppose a world with two persons and two goods, Is the folowing statement True, False, Both (True and False), or None (neither True nor
Falsek. "Each person has a comparative advantage."
a True
O b. False.
O’d, None

## product to work on: the product (good) is milk in the UAE is the research about: Use the ideas learned about demand and price elasticity of demand learned in class

product to work on: the product (good) is milk in the UAE is the research about: Use the ideas learned about demand and price elasticity of demand learned in class (and particularly the four key factors that determine price elasticity of demand – Chap 5) to discuss the expected price elasticity of the product you are assigned. Indicate what you expect the price elasticity of demand of the product to be (e.g. Elastic or inelastic). Support your view on the expected price elasticity by discussing the various variables likely to affect its elasticity: Aspects to cover in your report: Your discussion should include (but not limited to) the following: -what other products are likely to compete with it, and how this will affect its price elasticity -is the good a necessity, or not -how has the good/market been defined -cite relevant studies or reports that might have computed or analyzed elasticity of the product or related product. Make sure to reference all the studies or reports cited. At least four published articles must be cited and referenced. Outline of the research project: You must provide: 1. Introduction: Provide short description of product/ product category chosen, as well as explaining what price elasticity is. 2. Discussion section about the expected price elasticity of good you chose, with any supporting evidence from other research or reports

## A mother brings her 6-month-old daughter to the HCP for evaluation of possible colic. The mother says the baby has had many episodes of crying after eating and, despite having

A mother brings her 6-month-old daughter to the HCP for evaluation of possible colic. The mother says the baby has had many episodes of crying after eating and, despite having a good appetite, is not gaining weight. The mother says the baby’s belly “gets all swollen sometimes.” The mother says the baby tastes “salty” when the mother kisses the baby. Further work up reveals a diagnosis of cystic fibrosis. The mother relates that her 23-month-old son has had multiple episodes of “chest congestion” and was hospitalized once for pneumonia. The mother wants to know what cystic fibrosis is and she also wants to know if she should have any more children. For this Discussion, you examine a case study and explain the disease that is suggested. You examine the symptoms reported and explain the cells that are involved and potential alterations and impacts. Post an explanation of the disease highlighted in the scenario you were provided. Include the following in your explanation:

## Arturo’s task, as President Aylwin’s advisor, is to devise a strategy to reduce income inequality rapidly without sacrificing the macroeconomic gains of the military regime. A country of islanders. Chile,

Arturo’s task, as President Aylwin’s advisor, is to devise a strategy to reduce income inequality rapidly without sacrificing the macroeconomic gains of the military regime. A country of islanders. Chile, a country stretching along 2600 miles of the Pacific coast of South America, is abundantly endowed with natural resources. It is the world’s largest producer and exporter of copper: It produces 24 percent of world output of copper ore and CODELCO, the state-owned copper corporation, holds about 20 percent of the world’s known copper reserves. There are also substantial deposits of nitrates and of iron. Arable land is appropriate for the production of fruits, vegetables and wine, while there are as well substantial forested areas for timber exploitation. With a population of just over 13 million, its resources in these areas have been in excess of the domestic needs. Chile has as a consequence been oriented from the beginning toward foreign trade and international markets. As political scientist Federico Gil states, “the Chilean people … are in reality islanders”. This international dependence is heightened by the relative shortage of crude oil deposits within Chile. Policies changed dramatically under the military government of General Augusto Pinochet. The military regime had three main economic objectives: (i) liberalization of the economy to increase the role of markets, (ii) privatization to return firms to the private sector and restructure the public sector, and (iii) stabilization of inflation and avoidance of a balance of payments crisis. Adapted: Conway, P and Warnock, F (1997), Economic Management Training Conference, Economic Development Institute 2.1 Chile is abundantly endowed with natural resources. Are natural resources a necessary or sufficient condition for economic growth? Discuss. (15) 2.2 You are the Economic Advisor to the Chilean government under the Ministry of Industry and Economic Development; using information in the article submit suggestions about how the balance of trade and the current account respectively, can be turned into surplus. Make FIVE (5) suggestions in this regard and explain how they might serve to improve the balance of payments (BOP) position of Chile. (10)

## Nanotechnology (also called nanotech) is a branch of materials science that deals with manipulating matter on the atomic scale. It is so called because this field deals with engineering on

Nanotechnology (also called nanotech) is a branch of materials science that deals with manipulating matter on the atomic scale. It is so called because this field deals with engineering on the scale of a billionth of a meter, also known as a nanometer. Nanotechnology seeks to solve a wide range of problems from the construction of atomic scale machines to changing material properties at the atomic level. Use the Internet, Argosy University library resources, and your textbook to research the field of nanotechnology. Write a paper discussing some of the basic scientific and technical concepts of nanotechnology. Do the following in your paper: Write a 2–3-page paper in Word format. Apply APA standards to citation of sources. Use the following file naming convention: Purchase the answer to view it Purchase the answer to view it