Author Question: A trade policy that allows a country to gain at the expense of other countries is called A) ... (Read 47 times)

vicotolentino · **on:** Jul 1, 2018

A trade policy that allows a country to gain at the expense of other countries is called

A) countervailing duty policy.
B) a beggar-thy-neighbor policy.
C) an antitrust policy.
D) a dumping policy.

Question 2

Suppose there are 1000 identical wheat farmers. For each, TC = 10 + q2. Market demand is Q = 600,000 - 100p. Derive the short-run equilibrium Q, q, and p. Does the typical firm earn a short-run profit?

What will be an ideal response?

Laurenleakan · **Reply #1 on:** Jul 1, 2018

Answer to Question 1

B

Answer to Question 2

The firm's supply is q = 0.5p; market supply is Q = 500p. Market equilibrium can be found as 500p = 600,000 - 100p, or 600p = 600,000, so p = 1,000 and Q = 500,000.
q = 0.5p = 500. Profit = (500 1,000 ) - (10 + 250,000 ) = 249,990. Each firm earns a profit.