AEM 2500 Homework 1 fall 2010 f

AEM 2500 Homework 1 fall 2010 f - AEM 2500: Environmental...

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AEM 2500: Environmental and Resource Economics Homework 1 – Supply, Demand and Market Equilibrium Distributed: Sept. 3, 2010, due at the beginning of class Sept. 10, 2010 in Red Box outside Warren 102 (If you are having problems with some of the answers, you are advised to peruse the relevant gobbets on the course web site) 10 Points, each question counted equally. All graphs should be clearly labeled and all other work legible. If we are unable to interpret your work, you will receive a lower score. 1. The following demand schedule shows the number of annual visits to Mono Lake, California for each day at a variety of prices (or costs). “Price” of Trips to Mono Lake Number of Visits per Year 60 0 50 40,000 40 80,000 30 120,000 20 160,000 10 200,000 0 240,000 a. Graph the demand for visits to Mono Lake (assume that the lines extend linearly all the way to the axes and remains only in the positive quadrant. That is there is no negative demand or negative prices) b. Derive a linear equation for the demand curve you graphed. c. Derive a linear equation for the corresponding “inverse demand” function. d. Suppose that average income rises in California. i)
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This note was uploaded on 12/20/2010 for the course AEM 25 at Cornell University (Engineering School).

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AEM 2500 Homework 1 fall 2010 f - AEM 2500: Environmental...

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