finalreview - Review Problems Final Economics 304K:...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Review Problems Final Economics 304K: Principles of Microeconomics Prof. Meg Ledyard You do not need to turn these in, but you would be well advised to go through these questions, and be able to answer them. 1. Consider the perfectly competitive market for sunglasses in small country of Suntoobright. a. The no-trade market price for sunglasses is $30 and the quantity is 100. Please show this in a well labeled graph. b. The government of Suntoobright is considering opening to the world trade in sunglasses. The world price for sunglasses is $15. In the graph from above, please put in this world price, and show what happens to quantity demanded and quantity supplied. What is the difference between these quantities called? c. Label the graph above and show what happens to consumer surplus, producer surplus, government revenue and total surplus before and after trade. Is efficiency higher with or without trade? Who gains and who loses? d.
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 09/14/2009 for the course ECON 304K taught by Professor Ledyard during the Fall '08 term at University of Texas at Austin.

Page1 / 2

finalreview - Review Problems Final Economics 304K:...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online