making pp presentation for assignment related to assignment 1the attached document is our assignment 2 we discussed previously about Hermes international company’s financial statement, the requirements of new assignment are 4 sections , business, management report , auditor report and sustainability/ ethical report as pp presentation.
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making pp presentation for assiginment2 related to assignment 1the attached document is our assignment 2 we discussed previously about Hermes international company’s financial statement, the requirements of new assignment are 4 sections , business, management report , auditor report and sustainability/ ethical report as pp presentation.
HW 4 © Prof John Gasper / Carnegie Mellon University Page 1 of 9Homework Assignment 4Due: Friday, November 6, 2020 at 11:59 p.m. (23:59) EasternGeneral Submission Instructions:• Submit this assignment as one .pdf file via Gradescope. Do not forget to select the page(s)that contain the solution to each of the assigned problems. For more information, seethe “Gradescope submitting hw guide.pdf” on Canvas.• Title your homework as HW4_your last name.General Instructions:• Write neatly; illegible work will not be given any points.• Be certain to label graphs, equilibria, intersections (where appropriate).• Show all of your work / reasoning. Writing the correct number with no derivation will notbe given full credit. I need to know you understand the reasoning process.First Name:Last Name:Andrew ID:Note: There are a total of 9 pages (including this page).HW 4 © Prof John Gasper / Carnegie Mellon University Page 2 of 9
We’ve been discussing the effect of taxes. Let’s now consider the effect of subsidies, whichalso generate deadweight loss. A subsidy creates a gap between the price received by sellersand the price paid by buyers.Figure 1: Subsidies(a) (4 points) Complete the table using the letters from Figure 1. The government“revenue” is negative, because a subsidy requires a payment by the government.(Recall that society consists of producers, consumer and the government)Grading key: 16.6% for each correct cellNoSubsidyWith SubsidyConsumer SurplusProducer SurplusGovernment“Revenue”Social (Total) surplusHW 4 © Prof John Gasper / Carnegie Mellon University Page 3 of 9(b) (1 point) Based on this table, what is the deadweight loss of the subsidy? (Hint: this is thedifference in social surplus between the two columns.)Grading key: 100% – the deadweight loss is correct(c) (1 point) Describe why a subsidy creates deadweight loss. Try to use your answer to (b) as a guide.Grading key: 100% – the answer is clearly explainedHW 4 © Prof John Gasper / Carnegie Mellon University Page 4 of 9
(5 points) Suppose demand is QD = 20 – P, supply is QS = P. There is a constant positiveexternality of $6 per unit (Marginal External Benefit, MEB = $6). Find the maximumpossible social surplus.Grading key:• Explanation/Calculation shown – 80%• The maximum possible social surplus is correct – 20%HW 4 © Prof John Gasper / Carnegie Mellon University Page 5 of 9
Many cities tax or ban plastic grocery bags. The rationale for these taxes and bans is anexternalities argument: plastic bags are an eyesore, take up space in landfills, and damage fish,birds, and other wildlife.(a) (2 points) In the diagram below, show the efficient number of plastic bags and theequilibrium number of plastic bags in the absence of any government policies.Grading key:• The graph is correct, including– All relevant curves/lines and areas are labeled.– The efficient number of plastic bags islabeled.– The equilibrium number of plastic bags is labeled.(b) (1 point) Show the efficiency loss from plastic bags in your diagram.Grading key: Right or Wrong(c) (1 point) Show the tax on plastic bags that would lead to the efficient outcome.Grading key: Right or WrongHW 4 © Prof John Gasper / Carnegie Mellon University Page 6 of 9
Table 1 gives information about three industrial steel producing firms in Pittsburgh. Thegovernment wants to reduce total pollution to 120 units, and so it gives 40 tradablepollution permits to each firm. Each permit entitles a firm to pollute by one unit.Firm Initial Pollution Level Cost of Reducing Pollution by OneUnitABC80 units200 units20 units$10$5$20Table 1(a) (4 points) Graph the market demand and the supply for pollution permits.Grading key: The graph is correct, including– Axes are labeled and all relevant curves are labeled.HW 4 © Prof John Gasper / Carnegie Mellon University Page 7 of 9(b) (2 points) For each firm, indicate if they buy or sell permits and how many.• Grading key: 33% for each correct value(c) (2 points) By how much does each firm reduce pollution?• Grading key: 33% for each correct valuePrinciples of Microeconomics (73-102) – Fall 2020HW 4 © Prof John Gasper / Carnegie Mellon University Page 8 of 9(d) (1 point) What is the total cost of pollution reduction in this situation?Show your work to receive full credit.• Grading key:– Explanation/Calculation – 70%– Total cost of pollution reduction is correct – 30%Principles of Microeconomics (73-102) – Fall 2020HW 4 © Prof John Gasper / Carnegie Mellon University Page 9 of 9(e) (1 point) What would the total cost of pollution reduction be if thepermits could not be traded? Show your work to receive full credit.• Grading key:– Explanation/Calculation – 70%– Total cost of pollution reduction is correct – 30%
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