8. Anyone who has visited Japan knows it is an incredibly expensive place; although Japanese workers earn about the same as their U.S. counterparts, the purchasing power of their incomes is about one-third less. Extend your discussion from question 7 to explain this observation. (Hint: Think about wages and the implied prices of nontraded goods.)
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8. Anyone who has visited Japan knows it is an incredibly expensive place; although
Japanese workers earn about the same as their U.S. counterparts, the purchasing
power of their incomes is about one-third less. Extend your discussion from question
7 to explain this observation. (Hint: Think about wages and the implied prices of nontraded
goods.)
Step by step
Solved in 3 steps
- Plot the following hypothetical market demand and supply schedules for commodity X.Qd. P. Qs(units) (Peso) (Units)150. 30. 900300. 25. 800350. 20. 700600. 15. 600800. 10. 4001000. 5. 200 What is the equilibrium price? Equilibrium quantity? What happens to the Pe and Qe if market supply increases by 5% at all price levels without any increase in demand?Show your new demand and supply schedule and graph.The United States is increasingly outsourcing jobs to India: having the work done in India rather than in the United States. For example, the Indian firm Tata Consultancy Services, which provides information technology services, increased its work force by 70,000 workers in 2010 and expected to add 60,000 more in 2011 (“Outsourcing Firm Hiring 60,000 Workers in India,” San Francisco Chronicle, June 16, 2011). As a result of increased outsourcing, wages of some groups of Indian skilled workers have in-creased substantially over the years. Use a supply-and- demand diagram to explain this outcome.If the United States is currently importing 14 million barrels per day at a world price of $4.00 per unit (the entire amount consumed), what is the effect on imports of a tax equal to $4.00 per unit? 1.) Using the line drawing tool, help determine the quantity of U.S. crude oil imports after the $4.00 per-unit tax by drawing a horizontal line at the price paid by U.S. consumers. Label this line + Tax'. 2.) Using the point drawing tool, determine quantity demanded at the price paid by U.S. consumers after the imposition of the import tax. Label this line 'Pop'. 3.) Using the point drawing tool, determine quantity supplied at the price paid by U.S. consumers after the imposition of the import tax. Label this line "Pas". Carefully follow the instructions above and only draw the required objects. The amount of imports after the $4.00 per-unit tax is million barrels per day. Before the tax, domestic producers supplied 0 barrels of crude oil. They now supply million barrels Price per barrel…
- Problem #3. Suppose the official price of 1 ounce of gold in the US is 21.60 dollars and the official price of gold in the UK is 3.5 pounds sterling. 3A. Assuming no transport costs, the value of 1 pound sterling is US dollars. Now suppose there are transport costs for shipping gold from one market to another. The value of one currency in terms of another will no longer be constant; instead, it can fluctuate within a range. These we referred to as gold points. If the exchange rate should fall outside of this range, gold will be snipped from one market to another. Assume that it costs 5% of the purchase price (paid by the buyer) to ship gold from one market to O another. 3B. The lower value of 1 pound sterling in terms of the dollar in this range will be and the wor upper value of this range will be Show your work and explain your answer below.3 Using the information in the Table below answer the following questions: Quantity of labour demanded (billions of hours per year) 70 60 50 40 30 Real wage rate (2007 dollars per hour) 15 20 25 30 35 Real GDP (trillions of 2007 dollars per year) 3 9 14 18 21 Quantity of labour (billions of hours/ year) 20 30 40 50 60 Quantity of labour supplied (billions of hours per year) 10 20 30 40 50 Quantity of NEW Labour Supplied (Billional a) Set up a Two-Tier Graph with the top table describes an economy's labour market and the second table describes its production function. Clearly showing and labeling Potential GDP which is equal to b) An increase in population changes the quantity of labour supplied by 20 billion hours at each real wage rate. Fill in the Column in the above Table & Plot the new Supply Curve in your graph with the new Potential GDP is.In 2002, a meeting is hold in a state-owned farm with one million mu of arable land—B farm after the harvest: Production department section Li said: This year we planted 0.6 million Mu (a unit of area, 1 Mu=0.0667 hectares) wheat, and got 280 kilograms’ wheat per Mu. But after this year's harvest, a new difficulty arises that price of wheat is decreasing now. Usually, the farm will keep 10 million kilograms as seeds and 18 million kilograms for living, and sell the rest to the market. If the firm doesn't sell and keeps the wheat in a long term, the weight of the wheat will decline for the moisture loss from 14% to 13%, which means the farm will loss 1.4 million kilograms. The manager of the supply and marketing, Mr. Liu said: Last year, the price of wheat is 0.96 yuan per kilogram, but now is only 0.80 yuan per kilogram. This causes a big loss to our farm this year. Therefore, we can't sell now! The manager of grain, Mr. Lin said: We have to sell. We predict that the low wheat price…
- In 2002, a meeting is hold in a state-owned farm with one million mu of arable land—B farm after the harvest: Production department section Li said: This year we planted 0.6 million Mu (a unit of area, 1 Mu=0.0667 hectares) wheat, and got 280 kilograms’ wheat per Mu. But after this year's harvest, a new difficulty arises that price of wheat is decreasing now. Usually, the farm will keep 10 million kilograms as seeds and 18 million kilograms for living, and sell the rest to the market. If the firm doesn't sell and keeps the wheat in a long term, the weight of the wheat will decline for the moisture loss from 14% to 13%, which means the farm will loss 1.4 million kilograms. The manager of the supply and marketing, Mr. Liu said: Last year, the price of wheat is 0.96 yuan per kilogram, but now is only 0.80 yuan per kilogram. This causes a big loss to our farm this year. Therefore, we can't sell now! The manager of grain, Mr. Lin said: We have to sell. We predict that the low wheat price…QUESTION 6 The following figure depicts the supply and demand schedules of calculators for Greece, a "small" country that is unable to affect the world price. Greece's supply and demand schedules of calculators are respectively depicted by SG and DG Assume that Greece imports calculators from either Germany or France. Suppose Germany is the world's low-cost producer who can supply calculators to Greece at $20 per unit, while France can supply calculators at S30 per unit. Queny f Cako Referring to the above figure, suppose Greece forms a customs union with France. Greece will import: a. 3 calculators at a per-unit price of $40 b.3 calculators at a per-unit price of $30 c.6 calculators at a per-unit price of $30 d.6 calculators at a per-unit price of $40b) Now, suppose Northland and Southland are free to trade and that in the free-trade equilibrium the relative price of F is (PF/PC)FT=1.5. What is the wage in Northland relative to that in Southland, i.e., wNLD/wSLD? Explain how you calculated this quantity and the economic intuition behind your derivation and result.
- 7. For many years, various groups have accused China of "dumping" exports onto the US market. That is, they claim that the Chinese government subsidizes Chinese exporting firms to allow them to sell at lower prices than US firms and/or lower than sellers from other countries. Some trade policy analysts argue that the US is harmed by this dumping behavior and that the US should impose restrictions on imports from China. Use a supply and demand diagram to assess this argument. Do you agree with the argument made and policy prescribed by the trade analysts?7. Suppose that you were the manager of a large retail store that was currently experiencing a shoplifting problem. Every hour, approximately $15 worth of merchandise was being stolen from your store. Suppose that a security guard would completely eliminate the shoplifting in your store. If you were interested in maximizing your profits, should you hire a security guard if the wage rate of security guards was $20 per hour? Why or why not? What does this imply about the relationship between average shoplifting per hour in the economy and the wage rates of security guards?41. Which of the following is true? a) The net employment effect of trade is to reduce the number of jobs in the economy. b) It is impossible for a high wage economy to compete with a low wage economy. c) Imports of products subsidized by the exporting country government lead to net economic losses for the importing country. d) Protection of industries against imports helps these industries become more competitive. e) None of the above.