Business, 27.01.2021 20:20 Albala

Consider a two‑nation world consisting of the United States and Mexico, which both produce strawberries. Assume there are no trade barriers or international transportation costs. The tables represent the markets for strawberries in the United States and Mexico. Mexican prices have been converted to U. S. dollars. Price per pound Quantity supplied (in millions) Quantity demanded (in millions)
$2 300 500
$3 350 450
$4 400 400
$5 450 350
$6 500 300
$7 550 250
$8 600 200

Price per pound Quantity supplied (in millions) Quantity demanded (in millions)
$2 400 800
$3 450 750
$4 500 700
$5 550 650
$6 600 600
$7 650 550
$8 700 500

Required:
a. What is the equilibrium world price per pound?
b. What is the equilibrium quantity of exports and imports?
c. Which country will export strawberries?

a. United States
b. Mexico

Answers: 3

Show answers

Answers

The equilibrium world price per pound is $5. The equilibrium quantity of exports and imports is 1,000 pounds and the country that will export strawberries is the United States.

From the table given, it can be deduced that the equilibrium quantity of exports and imports is 1000 units. This is the quantity at which the quantity demanded and supplied are equal.

Based on the information, it can be deduced that the United States will export strawberries in order to meet the excess demand.

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Answer from: shod74

a. The equilibrium world price per pound is $5.

b. The equilibrium quantity of exports and imports is 1,000 pounds.

c. The country that will export strawberries is:

a. United States

Explanation:

Price per Quantity supplied Quantity demanded

pound US (in millions) Mexico World US (in millions) Mexico World

$2 300 400 700 500 800 1,300

$3 350 450 800 450 750 1,550

$4 400 500 900 400 700 1,100

$5 450 550 1,000 350 650 1,000

$6 500 600 1,100 300 600 900

$7 550 650 1,200 250 550 800

$8 600 700 1,300 200 500 700

b) At equilibrium when the world quantity supplied and demanded are equal, the world price per pound is $5 and the quantity demanded and supplied equaled 1,000 pounds respectively. At this equilibrium, the United States will export 100 pounds (450 - 350) of strawberry to meet the excess demand of 100 pounds by Mexico (650 - 550).

Answer from: Quest

the investment was $14,174.196

explanation:

a lump sum means that the father of the example made one deposit and leave it be.

we need to know the value of a capital that generated at 4.05% per year during 28 years the sum of $48,613.24

$capital * (1+0.045)^{28} = 48,613.24$

now clearing the formula to solve for capital we got:

$capital = \frac{48,613.24}{(1+0.045)^{28}}$

and we reach the answer investment = $14,174.20

Answer from: Quest

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