The inverse demand function for a depletable resources is P=8-0.4q and the marginal cost of supplying it is $2 If 20 units are to be allocated between two periods in a dynamic efficient allocation, how much would be allocated to the first period and how much to the second period when the discount rate is 5% and 10% (Hint Demand Function is the same in both periods) Given the discount rate what would be the efficient price in the two periods? What would be the marginal user cost in each period?

The inverse demand function for a depletable resources is P=8-0.4q and the marginal cost of supplying it is $2 If 20 units are to be allocated between two periods in a dynamic efficient allocation, how much would be allocated to the first period and how much to the second period when the discount rate is 5% and 10% (Hint Demand Function is the same in both periods) Given the discount rate what would be the efficient price in the two periods? What would be the marginal user cost in each period?

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter16: Labor Markets

Section: Chapter Questions

Problem 16.7P

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The inverse demand function for a depletable resource is P=8-0.4q and the marginal cost of supplying it is $2 If 20 units are to be allocated between two periods in a dynamic efficient allocation, how much would be allocated to the first period and how much to the second period when the discount rate is 5% and 10% (Hint Demand Function is the same in both periods) Given the discount rate, what would be the efficient price in the two periods? What would be the marginal user cost in each period? Assume a discount rate of 10% determine the efficient allocation amount between the two period Prepare a schedule of the discount rate and the efficient allocation for the two-period and graph the relationship. What can you say about the discount rate and the allocation between the two periods?
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Consider the demand function for processed pork in Canada, Qd = = 270.00 - 12p +20p + 3pc +0.002Y The supply function for processed pork in Canada is: Qs p is the price of pork Q is the quantity of pork demanded (measured in millions of kg per year) Solve for the equilibrium price and quantity for pork. The equilibrium price of pork is $ rounded to two decimal places.) = 234.00 + 36p - 60ph Pp is the price of beef = $4 per kg Pc is the price of chicken = $3 per kg Y is the income of consumers = $12,500 Ph is the price of a hog = $1.50 per kg and the equilibrium quantity of pork is million kg per year. (Enter numeric responses using real numbers
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