hwk6sec4 - Answer Key for Experiment 6 Blue cells have...

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Answer Key for Experiment 6. Blue cells have instructions for you to follow. Enter data in the yellow cells. Keep going until you hit the finish line at the end of this sheet. Enter Section Number in E7 4 Enter pollution cost in E9 0.5 Enter # of permits in E11 9 Copy rows of Table 6.2 (No header row) and paste into B17. Seller Cost 28 3 20 3 23 4 25 3 18 5 30 3 13 6 35 4 8 3 40 6 Copy and paste rows of Table 6.3 (no header row) into A27. Session 1 Trans Price Seller Cost Buyer Value Seller Prof Buyer Prof. 1 22 18 30 2 22 13 25 3 23 13 35 4 25.5 23 40 5 20 13 25 6 25 23 30 7 21 13 35 8 15 8 20 9 25 8 40 10 26 18 40 11 30 23 40 12 21 18 30 13 25 13 40 14 24 8 40 15 22 18 35 16 22 13 35 Copy the rows in Table 6.4 (no header row) and paste into A57. Session 2 Trans Price Seller Cost Buyer Val. Pol. Tax Seller Prof Buyer Prof. 1 34 8 40 2 34 13 35 3 34.5 13 40 4 33 8 40 5 34 13 40 6 34 13 35 7 36 13 40 8 34 8 40 Copy the rows in Table 6.5 (no header row) and paste into A88. Session 3--Last Round Trans Price Seller Cost Buyer Val. Permit Price Seller Prof. Buyer Prof. 1 39 13 40 10 2 30 23 40 13 3 30 18 40 8 4 30 28 35 0 5 29 18 35 11 6 25 8 30 11 7 28 13 40 11 8 29.9 13 30 10 9 30 13 35 10 Go to Figure 6.5 on the homework page and a dot to the intersection of the green demand curve and the red supply curve. Move "CE1" next to this dot. Now move a dot to the intersection of the green demand curve and the blue supply curve. Move the label "CE2" next to this dot. Session 1 For Session 1, the equilibrium price can be $23, $25, or any price in the range of $23-$25. The case you have depends on how many buyers with buyer value of $25 or more and seller with sellers cost of $23 or less. Here are the numbers for you: Buyers with BV of $25 or more: 16 Sellers with SC of $23 or less: 18 Case 1: If the buyers with BV of $25 or more exceeds the sellers with cost of $23 or less, price is $25 and and quantity is the number of sellers with seller cost of 23 or more Case 2: If the buyers with BV of $25 or more is less than the sellers with cost of $23 or less, price is $23 and quantity is the number of buyers with buyer value of $25 or more. Case 3: If the buyers with BV of $25 or more equals the sellers with cost of $23 or less, price could be anywhere in the range between $23 and $25 and quantity will equal the number of buyers with buyer value of $25 or more, which equals the number of sellers with seller cost of $23 or less.
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