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国际贸易代上网课 quiz代写

2021-10-12 15:23 星期二 所属: 经济作业 浏览:369

国际贸易代上网课

Quiz 2

国际贸易代上网课 Assume furthermore that all drydocks of any specific country are essentially the same, sotheir cost curves are identical.

Setting. We will take a look at the international shipbuilding industry. In this industry, firms arerespresented by drydocks and consumers are shipping alliances. To build ships, each drydock employslabor and rents capital. Assume throughout that production technology of the docks is characterizedby homothetic isoquantsdecreasing returns to scale everywhere, and sig-nificant recurring fixed costs. Assume furthermore that all drydocks of any specific country are essentially the same, sotheir cost curves are identical. Finally, assume that on the international scale there are no speculators,so when a ship is sold outside the country it is sold by the producer.

Part I 国际贸易代上网课

First, we will look at the capital and labor decisions of the individual drydocks.

  1. Given our assumptions about the production technology of the firms, plot their long-run marginal cost and average cost curves. Indicate the supply curve on your
  2. Withlabor on x-axis and capital on y-axis, plot the isoquant of some drydock correspondingto its profitmaximizing output level. On the same plot, show the isocost corresponding to thesame profitmaximizing solution. Denote lk, and x the corresponding labor, capital, and output respectively.
  3. What two conditions determine the optimal levels kand l?
  4. Overtime, rental rates of capital and labor wages to which docks are exposed have changedquite a  Suppose one specific dock was in the equilibrium when both r and w changed. Thechange happened in such a way that in the new long-run equilibrium the dock still producesat x. Assuming that the dock employs relatively less labor now, show on your plot where its new production plan is. How has the ratio r/w changed?
国际贸易代上网课
国际贸易代上网课

Part II 国际贸易代上网课

Recently, China identified this industry as one of key interest. In particular, the central govern-ment plan of 2005 set it as the goal to make China the largest1 shipbuilding nation in the world by2015. As a consequence, local governments of the country started considering the following forms of intervention

(a)Subsidies for capital spending — effectively, decreasesr

(b)Subsidies for wage bills — effectively, decreasesw

 


1as of today, it is in the 2nd place behind South Korea

(c)Subsidies for recurring fixed costs

(d)Revenue boost (that is, the government gives s dollars to the firm for every dollar itearns)国际贸易代上网课

  1. From2006 on, China experienced explosive growth in the number of new  Which of the above policies would have definitely resulted in such a boost?
  2. Howwould your answer to the previous question have changed if you additionally assumed that every single dock in the country also decreased its output? Explain
  3. Ifthe goal of the government was to boost the industry output up to some specific level, which subsidy would you expect to be the cheapest? Explain
  4. Inour analysis, we typically assume that firms only need capital and  Most modern drydocks, however, simply put together components of ships which are manufactured elsewhere. In other words, they use the third input, materials, which constitutes a major share of their expenses. Assuming components for a ship always cost the same amount c, what changes about your conclusions above? Is there a way to account for these costs in our model without changing anything about the cost structure of the firms?  

Part III

Let us now consider China in the context of the international market.

  1. Suppose that in equilibrium there is no trade (although trade is not restricted) between China and the rest of the world. Plot two graphs: one corresponding to Chinese long run supply and demand, another — corresponding to the Rest Of the World [ROW]. For simplicity, let usassume that China is big relative to ROW and represent it with horizontal long run supply, while ROW’s supply curve is sloping upward. 国际贸易代上网课

2.SupposeChina subsidizes its own drydocks by reducing their recurring fixed  Show the effects of such a subsidy on your graphs. What happens to the ship prices? What about the total quantity of ships produced in China?

3.Between consumers and producers within China, who gains and who loses because of the subsidies?Does the policy result in deadweight loss? If so, illustrate its size on your graphs.

4.Mostcountries with strong shipbuilding industries have historically subsidized their produc- ers2. Suppose South Korea wanted to maintain the output of its drydocks at a fixed level. How would it respond to China’s subsidies? If China really intended to become “the largest shipbuilding nation,” what would it do in turn after Korea’s response?

 


2As a consequence, internationally the industry is characterized by excess capacity. For example, sometimes companies abandon their ships in open waters altogether to avoid paying the maintenance costs. 国际贸易代上网课

Note International trade agreements try to restrict direct subsidies into shipbuilding, but thecountries subsidize anyway. One of the hurdles in the way of enforcing these restrictions, as indicatedby the World Trade Organization, is the opaque nature of the subsidies. Even if their presence seems obvious, like in the case of China, it is hard to tell what their $ impact is in terms of DWL and consumer/producer surpluses. Some of the recent progress in economic research involves recovering the volume of the subsidies based on observable outcomes: number of drydocks, ship prices, and output volumes.

国际贸易代上网课
国际贸易代上网课

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