Business, 05.05.2020 22:11, pchaneh31

If the domestic demand curve is Equal 20p Superscript negative 0.5, the domestic supply curve is Equal 5p Superscript 0.5, and the world price is $7.00, use calculus to determine the changes in consumer surplus, producer surplus, and welfare from eliminating free trade. The change in consumer surplus (Upper DeltaCS) from eliminating free trade is $ nothing. (Enter your resp

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answered: nikeahbrown

$52

$ 1.33

consumer price will increase consumer surplus will decreaseimport will decrease reduced exportportends gloom for the general outlook for the economy

Explanation:

Given domestic demand curve, S(p) = 20p⁻⁰°⁵

the domestic supply curve S(p)= 5p⁰°⁵

world price is $7.00

using calculus to determine the changes in consumer surplus

by consumer surplus means in this case supply exceeds demand

we establish the equilibrium point where the supply and demand functions meet or are equal

solving 20p⁻⁰°⁵ = 5p⁰°⁵

20/5 = p⁰°⁵/p⁻⁰°⁵

4 = p⁰°⁵⁺⁰°⁵

4= p = q which is the quantity produced

consumer surplus = maximum price willing to pay - Actual price

= ∫⁴₀ dp dp - p* q

= ∫⁴₀20p⁻⁰°⁵ dp- 7* 4

= 20∫⁴₀p⁻⁰°⁵ dp -28

= 20/0.5 p⁰°⁵- 28

= 40 *4⁰°⁵ - 28 = $52

producer surplus = it is a measure of producer welfare. It is measured as the difference between what producers are willing and able to supply a good for and the price they actually receive

thus producer surplus = p* q - ∫⁴₀ d(s) dp

= 7 * 4 - ∫⁴₀ 5p⁰°⁵ dp

= 28 - 5 ∫⁴₀ p⁰°⁵ dp

= 28 -5 *2/3 p¹°⁵

= 28 -5 *2/3 4¹°⁵

=$ 1.33

welfare from eliminating free trade

consumer price will increase consumer surplus will decreaseimport will decrease reduced exportsportends gloom for the general outlook for the economy

answered: Guest

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answered: Guest

Secured loans are protected by collateral security. examples: title loans where the borrower uses the car title as collateral security interest rates are lower and repayments are longer therefore risk is low as a collateral security is given as guarantee to the bank in case of failure to pay the loanunsecured loans are not protected by collateral security but it is given on the creditworthiness of the borrower, trusting that she/he will pay on time. examples; payday loans is a short term loan where the borrower lends money from the bank and pays is back when the borrower receives his/her wages.interest rates are high and repayments are shorter. but the risk is high as no collateral security is given as a guarantee to the bank for payment of the loan

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If the domestic demand curve is Equal 20p Superscript negative 0.5, the domestic supply curve is Equ...