ÆFINGADÆMI
ÚR KÖFLUM 8-10 Í MANKIW
Kafli 8, dæmi 4, bls. 176.
a.
With very elastic supply and very inelastic demand, the burden of the tax on
rubber bands will be borne largely by buyers. As Figure 8-4 shows,
consumer surplus declines considerably, by area A+B, but producer
surplus doesn’t fall much at all, just by area C+D.
Figure 8-4
b.
With very inelastic supply and very elastic demand, the burden of the
tax on rubber bands will be borne largely by sellers. As Figure 8-5
shows, consumer surplus doesn’t decline much, just by area A+B,
while producer surplus falls substantially, by area C+D. Compared to
part (a), producers bear much more of the burden of the tax, and
consumers bear much less.
Figure 8-5
Kafli 9, dæmi 3, bls. 201.
Figure 9-5 shows the market for cotton in countries A and B. Note that the
world price of cotton is the same in both countries. Country A imports cotton
from country B. The table below shows that total surplus is higher in both
countries. However, in country A, consumers are better off and producers are
worse off, while in country B, consumers are worse off and producers are
better off.
Figure 9-5
Consumer Surplus
Producer Surplus
Total Surplus
COUNTRY A
Before Trade
After Trade
C
C+D+F
D+E
E
C+D+E
C+D+E+F
CHANGE
+(D+F)
–D
+F
Consumer Surplus
Producer Surplus
Total Surplus
COUNTRY B
Before Trade
After Trade
G+H
G
I
H+I+J
G+H+I
G+H+I+J
CHANGE
–H
+(H+J)
+J
Dæmi 9, dæmi 4, bls 201.
The impact of a tariff on imported autos is shown in Figure 9-6. Without the
tariff, the price of an auto is PW , the quantity produced in the United States is
Q1 S, and the quantity purchased in the United States is Q1 D. The United States
imports autos in the quantity Q1 D - Q1 S. The imposition of the tariff raises the
price of autos to PW + t, causing an increase in quantity supplied by U.S.
producers to Q2 S and a decline in the quantity demanded to Q2 D, thus reducing
the number of imports to Q2 D - Q2 S. The table shows the impact on consumer
surplus, producer surplus, government revenue, and total surplus both before
(OLD) and after (NEW) the imposition of the tariff, as well as the change
(CHANGE). Since consumer surplus declines by C+D+E+F while producer
surplus rises by C and government revenue rises by E, deadweight loss is
D+F. The loss of consumer surplus in the amount C+D+E+F is split up as
follows: C goes to producers, E goes to the government, and D+F is
deadweight loss.
Figure 9-6
Consumer Surplus
Producer Surplus
Government
Revenue
Total Surplus
Before Tariff
A+B+C+D+E+F
After Tariff
A+B
G
0
C+G
E
A+B+C+D+E+F+
G
A+B+C+E+
G
CHANGE
–
(C+D+E+F)
+C
+E
–(D+F)
Kafli 10, dæmi 4, bls. 223.
a.
The externality is noise pollution. Ringo’s consumption of rock and
roll music affects Luciano, but Ringo doesn’t take that into account in
deciding how loud he plays his music.
b.
The landlord could impose a rule that music couldn’t be played above
a certain decibel level. This could be inefficient because there would
be no harm done by Ringo playing his music loud if Luciano isn’t
home.
c.
Ringo and Luciano could negotiate an agreement that might, for
example, allow Ringo to play his music loud at certain times of the
day. They might not be able to reach an agreement if the transactions
costs are high or if bargaining fails because each holds out for a better
deal.
Kafli 10, dæmi 6, bls. 223
a.
The market for alcohol is shown in Figure 10-3. The social value
curve is below the demand curve because of the externality from
increased motor vehicle accidents caused by those who drink and
drive. The free-market equilibrium level of output is Qmarket and the
efficient level of output is Qoptimum .
b.
The triangular area between points A, B, and C represents the
deadweight loss of the market equilibrium. This area shows the
amount by which social costs exceed social value for the quantity of
alcohol consumption beyond the efficient level.
Figure 10-3