Everything since last exam33 questionscheck for example quizcan use calculator 1

question about cross-price elasticityE

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put into equationWill tell you whether they are sub or complimentsIf pos they re subsIf neg they are compliments#3,4,5 will be about price controlsknow 2 types of price control price ceiling price floor know whether they are binding or not bindingif they are not binding, we are doneif they are binding, we either have surplus or shortage… impactclassic example: floor = minimum wageceiling = rent controlwhen are they bindingwhat will be the consequence** know story about minimum wage****when is it bindingwho benefits from it – how manywho will be hurt from it – how many peoplego to lab sheets and find one about minimum wage and understand it#next few questions are about taxesknow: when a tax is imposed in a given market – it does not matter where thetax will create wedge between paid and receive – price paid will be higher tax will shrink market – equil will be lower buyers and seelers share burden burden of tax will fall more heavily on the least elasticless elastic you are the more you will paytax creates dead weight losswill be asked to calculate whole rectangle for amount of tax – length pb-pswhat is dead weight loss—triangle on inside

He will make it with easy numbersBurden of taxation – tax will fall more heavily on least elastic side of mktWELFARE ECONOMY – WILL BE DOMINATE PART OF EXAM!!!!!!!!!!!!!!Go back to get lab sheetsExample of Alicia of bottle water Willingness to payCost of productionCsurplus – area above price below demand curvePsurplus – above supply but below price – ½ b *hTsurplus – consumer + producer; or whole traiangle, when Qo is produced – valueto buyers – cost to sellersDefinition in wordsAnd be able to calculateLook at all lab sheetsGo back and identify with area – Many many questionsMust master this sectionUse this to revisit taxation!!! Question might be about taxes and welfareCASE OF TAXATIONHave to know story – economy working freely then govt puts tax on mkt – then say howwill tax affect peoples well-being… compare surpluses before and after tax… whichcreates a dead-weight lost (little traiangle)Equity/efficency – know differenceGreatest ts = efficency bigger tax = bigger elasticityRemember the laffer curveWhat determines dwl – elasticityTax revenue vs tax sizeCalculate and identify and why there is a dwl lost

bcAnd determine sizeCalculation between tax collection and taxINTERNATIONAL TRADE!!!Know story of international tradeWhen we open economy we face world price which may be higher or lower thandomestic priceIf higher, we ceome export – consumers are worse off producers are btter, society is better off If lower – we are import consumers are better off, producers are worse off, society is better off Draw this graphically pw pw #2know args for national tradeunfair competition protection asthere are 510 questions all together 2 waystariff set quota - limit on qtys you can importhave to have in mind pic of tariff sss