Assignment02-2003 - AEB 6533 Assignment 2 Assuming a set of...

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AEB 6533 Assignment 2 Assuming a set of demand elasticities ( 1 ε ), a set of supply elasticities ( 1 η ), equlibrium prices ( 1 p ), and equlibrium quantities ( 1 q ) in country 1: 1 1 1 1 1.50 0.75 3.50 0.61 0.50 5.70 0.50 0.05 1000 0.04 0.30 750 p q  ε= =   η= = along with a set of demand elasticities ( 2 ε ), a set of supply elasticities ( 2 η ), equlibrium prices ( 2 p ), and equlibrium quantities ( 2 q ) in country 1: 2 2 2 2 1.25 0.80 3.25 1.08 0.75 6.00 0.60 0.07 1250 0.09 0.40 500 p q = = the social welfare can be expressed as: 11 11 12 12 21 21 22 22 11 1 1 11 ,,,, ,,, 22 2 22 11 11 112 12 12 max ,, sdsd dd d ss s qqqq d s ds dsd aq q Aq bq q Bq qqq qq  ′′ +− + +   + === ± ± ± ± ± ± ± ± 21 21 2 22 22 11 11 21 21 12 12 22 22 , .. 0 0 s dsds q q st q q q q = −+−= where () 0.00478 0.00796 14.252 33.119 0.00796 0.0259 0.007097 0.001577 4.780 15.140 0.001577 0.025684 0.02753 0.07342 74.372 203.658 0.07342 0.21178 0.004 3.296 11.864 aA bB −− == =− = = ± ± ± ± ± ±
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This note was uploaded on 11/08/2011 for the course AEB 6533 taught by Professor Moss during the Fall '08 term at University of Florida.

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