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Hello, Thanks for the reply. Here are the questions.
1 Suppose that the U. S. were involved in a trade dispute with the European Economic Community over tariffs which they had imposed on our goods. If we wished to impose a retaliatory tariff on their goods, would it be more effective to impose the tax on their olive oil or on their beer? Explain your reasoning.
2 Would you expect the price elasticity of demand for a particular brand of breakfast cereal, such as “Wheaties,” to be higher or lower than the elasticity of demand for the total breakfast cereal market?
3 "At least half a dozen states and cities from Florida to Hawaii now impose $2 to $7 surcharges on car rentals. These fees can amount to as much as a 30% tax on 1day rentals."
Explain why states and cities are tempted to tax car rentals at higher rates than other goods and services.
4 Why would two railroads seeking approval for a merger from the department of justice, present evidence that the cross price elasticity of rail and trucking freight services is high and positive?
5 "Karen is considering purchasing a pair of shoes that cost $120 or a skirt that costs $80. If she ends up purchasing the skirt, then we can infer that the marginal utility of that additional skirt was greater for her than the marginal utility of the additional pair of shoes." Is the statement in quotes true correct? Explain your answer.
6 Why does the demand schedule for a typical good or service slope downward? i.e. Why does quantity demanded increase, when price decreases, other things equal. Explain in a few sentences.