HW4-Welfare, Monopoly - EEP 100 Homework # 4 Voluntary:...

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EEP 100 Homework # 4 Perloff Voluntary: Answers to be posted on March 29 Questions 1. What were the welfare effects (who gained, who lost, what was the deadweight loss) of the gasoline price controls described in Chapter 2? Add the relevant areas to a drawing like Figure 2.14. 2. In 2002, Los Angeles imposed a ban on new billboards. Owners of existing billboards did not oppose the ban. Why? What are the implications of the ban for producer surplus, consumer surplus, and welfare? Who are the producers and consumers in your analysis? How else does the ban affect welfare in Los Angeles? 3. The park service wants to restrict the number of visitors to Yellowstone National Park to Q *, which is fewer than the current volume. It considers two policies: (a) raising the price of admissions and (b) setting a quota. Compare the effects of these two policies on consumer surplus and welfare. Use a graph to show which policy is superior by your criterion. 4. A government is considering a quota and a tariff, both of which will reduce imports by the same amount. Why might the government prefer one of these policies to the other? 5.
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This note was uploaded on 02/04/2011 for the course EEP 100 taught by Professor Perloff during the Spring '10 term at University of California, Berkeley.

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HW4-Welfare, Monopoly - EEP 100 Homework # 4 Voluntary:...

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