Use Figure 1 below to answer questions 22-24. Suppose there are two jurisdictions, A and B.The graphic above shows the market for capital in jurisdiction A. Initially, equilibrium is at pointe on the graph, with equilibrium return Ro and equilibrium quantity of capital in jurisdiction A ofKo. Suppose a property tax, viewed as a tax on capital, is introduced into jurisdiction A at a rateof eg (on the graph) but that property remains untaxed in jurisdiction B.Figure 1RRAabeRRRoсRBdReDeKAKoK22. [3] Suppose we are in the short run and capital is immobile. What is the after-tax return oncapital immediately after the is imposed it is imposed.(a) RA(b) RB(c) Rc(d) RoA

The reason is as follows:Capital is not easily moved in the near term. Consequently, enterprises…

Answered: Use Figure 1 below to answer questions…

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter12: The Partial Equilibrium Competitive Model

Section: Chapter Questions

Problem 12.11P

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There are a range of property rights regimes that are possible in agriculture. These range from a landowner who pays fixed wages to her farm worker and keeps all profits from working the land, all the way to a tenant who pays a fixed rental fee to the landowner and keeps all profits from working the land. Somewhere in the middle is a sharecropping arrangement where the landowner and tenant share the revenues from selling their crops (normally in equal proportion). Suppose the agricultural output of a plot of land depends on the inputs y of a landowner and the inputs x of a tenant. Output is given by Q = A[logx + logy] , where A = 10. The price received for the goods is p = 1, the cost of a unit of effort to the tenant is w = 1 and the cost to the landowner of a unit of her inputs is r = 2. Question:Suppose the landowner and the tenant share output in equal proportions. What will be the levels of x and y? What is total output?
Consider a large tract of land that is used for grazing sheep. Now consider two differentproperty ownership regimes: common property ownership, in which all shepherds haveunrestricted access to the land, and private property ownership, in which there is a singlelandowner who hires shepherds up until the point where their wage is equal to the marginalproduct of their labor. Show graphically how common property resource ownership can lead toovergrazing (too many shepherds using the same open-access rangeland) in the absence ofinstitutional constraints that would ensure an efficient level of resource usage. Contrast this withprivate property ownership. On your graph, label the axes, the average and marginal products oflabor, the wage, scarcity rents, the efficient number of shepherds, and the number that would beexpected under common property ownership. Explain the source of the inefficiency. Wouldprivatization be equitable? Would it be possible to achieve an efficient resource…
How is opportunity cost treated in calculating cost of equity
. Given that an economy of a certain country consists of three sectors; Mining (M), Textile (T) and Chemicals (C). The input – output matrix for the economy is given by: Mining Chemicals Textile Mining 0.4 0.1 0.1 Chemicals 0.1 0.4 0.3 Textile 0.2 0.2 0.2 Suppose the sector is required to meet an external demand of KES 672 million, KES 224 million and KES 448 million from the mining, chemical and textile sector respectively, determine the final output.
Assume that President Trump develops an executive agreement with Russia this month, which will reduce taxes on imports from the country as way to promote cordial international business interests. This executive agreement is directly in conflict with a foreign tax treaty issued by Congress in May of last year. Assuming the president has the power to develop this agreement what is the likely outcome? The congressional treaty is discriminatory on its face and will be deemed unconstitutional O The President's order will supercede the congressional treaty O The President's order is in direct conflict with Congress' enumerated powers to tax and therefore will be struck down O The congressional treaty will be upheld
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2. Suppose there are only two people, Simon and Charity, who must split a fixed income of $100. For Simon, the marginal utility of income is MU, = 400 - 21, whereas for Charity, marginal utility is MU= 400 - 61 where I, I, are the amounts of income to Charity and Simon, respectively. a. What is the optimal distribution of income if the social welfare function is additive? b. What is the optimal distribution if society val- ues only the utility of Charity? What if the reverse is true? Comment on your answers. c. Finally, comment on how your answers change if the marginal utility of income for both Simon and Charity is constant: MU₂ = 400 MU, = 400
lescription is incorrect ( ) A According to the overlapping demand theory, the intra-industry trade between countries with large income gap will be less. 0307 The theory of comparative advantage helps to explain the intra-industry trade between developed countries. The smaller the difference of factor endowments between two countries, the greater proportion of intra-industry trade should be.
Suppose that a product is produced in three factories X, Y and Z. It is known that factory X produces thrice as many items as factory Y, and that factories Y and Z produce the same number of items. Assume that it is known that 3 per cent of the itenis produced by each of the factories X and Z are defective while 5 per cent of those manufactured by factory Y are defective. All the items produced in the three factories are stocked, and an item of product is selected at random. (i) What is the probability that this item is defective? (ii) If an item selected at random is found to be defective, what is the probability that it was produced by factory X, Y and Z respectively?
Using the figures below, construct a complete picture of the vicious circles of economic and politicalpoverty in South Africa or an African country of your choice, and outline the effects upon the poor andupon the state if the situation is not addressed by government and its public bureaucracy. If there is noreversal what would be the implications in respect of the possible collapse of the state through a popularuprising or rebellion. Discuss comprehensively, in terms of learnt theory and your observations. Inaddition to the politicians, is the bureaucracy also to blame? Can this situation be overcome? If so, how?If not, why not.
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1) John is operating an internation business in the United Stateds of American and is focused on the limitation or short-term impact of an issue. It can be said that John has a ............. 2) The grestest good for the greatest number of persons is known as the ............... approach. 3) this theorgy states that a country's wealth was deternmined by the amount of its gold and silver holding. It is ...........?

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