Category: Economics

Both public goods and common resources involve externalities.
Are the externalities associated with public goods generally positive or negative? Is the free-market quantity of public goods generally greater or less than the socially efficient quantity? Cite examples in your answer.
Are the externalities associated with common resources generally positive or negative? Is the free-market use of common resources generally greater or less than the socially efficient use? Cite examples in your answer.
3. What is cost-benefit analysis of public goods? Why is it important? Why is it hard?
Define and give an example of a common resource. Without government intervention, will people use this good too much or too little? Why?

➤ How is the market equilibrium price for permits determined when trading is costless?
The equilibrium price equals the market-clearing level where aggregate demand for permits meets the fixed supply set by the cap. Each firm’s demand reflects its marginal abatement costs. At the intersection of supply and demand, the permit market clears and that price signals the marginal cost of abatement economy-wide.

This week, we’re focusing on the widespread issues of poverty and income inequality, which impact millions of people worldwide. Public policy and funding often aim to address these challenges, but how effective are these efforts? Choose one of the following areas to explore in your post: income support programs (e.g., SNAP, TANF) or income inequality reduction strategies (e.g., progressive tax systems, minimum wage laws). Describe an example of a program or policy related to your chosen area. What is it intended to achieve? Analyze the impact of this program or policy on:
Accessibility:
Does this policy or program effectively reach those in need, or are some groups still underserved?
Economic Mobility:
Does it create opportunities for people to improve their economic situations, or are there barriers that limit its effectiveness?
Income Inequality:
Has this policy made any difference in narrowing income gaps, or does it fall short?
Share any interesting or surprising findings! Consider improvements: As a policy-maker, what changes would you propose to make this policy more effective or fairer for all? Think creatively and suggest practical adjustments!

Method 2: Tradable Permits Meanwhile, the other employee proposes using a different strategy to achieve the government’s goal of reducing pollution in the area from 12 units to 6 units. This employee suggests that the government issue two pollution permits to each firm. For each permit a firm has in its possession, it can emit 1 unit of pollution. Firms are free to trade pollution permits with one another (that is, buy and sell them) as long as both firms can agree on a price. For example, if firm A agrees to sell a permit to firm B at an agreed-upon price, then firm B would end up with three permits and would need to reduce its pollution by only 1 unit while firm A would end up with only one permit and would have to reduce its pollution by 3 units. Assume the negotiation and exchange of permits are costless. Because firm B has high pollution-reduction costs, it thinks it might be better off buying a permit from firm C and a permit from firm A so that it doesn’t have to reduce its own pollution emissions. At which of the following prices is firm C willing to sell one of its permits to firm B, but firm A is not? Check all that apply.
$90
$178
$186
$451
$529

If price is $7 per unit of output, draw the marginal revenue curve. The manager should produce ____ units to maximize profit. Because average total cost is $ ____ for this output, total cost is $____________. The firm makes a profit of $____________. At ____________ units, profit margin (or average profit) is maximized. Why is this output level different from the answer to part a? Let price fall to $3, and draw the new marginal revenue curve. The manager should now produce ____________ units to maximize profit. Total revenue is now $____________ and total cost is $____________. The firm makes a loss of $____________. Total variable cost is $____________, leaving $____________ to apply to fixed cost. If price falls below $____________, the firm will produce zero output. Explain why. PROVIDE ALL EQUATIONS AND EXPLANATIONS FOR EACH

Attached is a picture of income growth for various income sectors of the US economy. That is the actual income growth for each percentile of the economy. So, for example the lowest 10% of the income universe had a certain income growth, the 2nd lowest 10% had a different income growth, and so on. The 2 lines are for 2 different time periods: 1980, 2014. Obviously what the actual income growth happened to be at any instant in time will be the basis of expected income growth. a. explain what the chart means for expected growth for various percentiles in the 2 time periods? b. what does this suggest about the distribution of income movement over time period? c. given that students, just starting their career, will be at the lower percentile of income, how does this affect expectations for income opportunities for a student looking at their prospects in 1980 as opposed to 2014? d. any other thoughts you might have. Gather your thoughts, make the video covering all the questions, this is a lot, but keep this short: 1 – 2 minutes. Use some concepts from Chapter 23 in your discussion. Feel free to comment on any of your colleague’s video. Extra credit 10 points