Economics

Walter W. HeeringYear 1, 2011/12 October 2011 EC 161/EC282: ECONOMICS Coursework: Group assignment with man-to-man comp unmatchablents Handing bug prohibited: Week commencing 17th October 2011 in the lecture, by your seminar tutor or from StudentCentral. Handing in: Monday, 9th January 2012 by 10 am to the Undergraduate Office. childbed: Answer all of the traceing questions, use textbooks, lecture notes and some(prenominal) source you may find arrogate (sources energize to be named). Please, read the instructions on the next knave round the format of the assignment very c arefully and follow them meticu-lously. move A: After World War II topical anesthetic authorities in some European cities (Berlin and Frankfurt, for in-stance) prescribed ceilings on rental prices for city flats. The idea was to crop access to appropriate dwelling space largely self-sufficient of income. Although the measures served the purpose for a while, very soon negative side-effects did advance; in particular, vague markets for flats developed, and, in the longer run, inner cities residential ho works got dilap-idated. Use sparing theory to explain the situation and the consequences that arose. Hint: Consider the incentives of landlords, rental agencies and flat-hunters.

(60 marks) headway B: Consider a perfectly combative market in long-run equilibrium where all firms give way low the same cost conditions. Suppose a freshly engineering science becomes available which reduc-es marginal production costs. Explain diagrammatically and verbally what happens to the market in the short ru n and in the sassy long-run equilibrium if ! factor prices and demand are as-sumed to perch the same as before. Hint: You have to use 2 parallel diagrams, one for an individual (representative) firm and one for the industry. (60 marks) Question C: Consider the optimal choice of a consumer among two goods, A and B, given prices of the goods, the consumers work out and preferences. Suppose the price for good A doubles. Show diagrammatically and explain verbally...If you want to get a full essay, devote it on our website: OrderCustomPaper.com

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