Assignment for submission for Week 7Submit solutions to the following two problems. Submit in an Excel workbook with each problem in a separate worksheet (tab). Show your calculations in Excel. That...

Assignment for submission for Week 7Submit solutions to the following two problems. Submit in an Excel workbook with each problem in a separate worksheet (tab). Show your calculations in Excel. That is, use Excel to make the calculations.Problem 1In a competitive market, the industry demand and supply curves are:P = 200 − .3Qd (Demand)P = 100 + .4Qs (Supply)a. Find the market’s equilibrium price and output.b. Suppose the government imposes a tax of $15 per unit of output on all firms in the industry. What effect does this have on the industry supply curve? Find the new competitive price and output. What portion of the tax has been passed on to consumers via a higher price?c. Suppose a $15-per-unit sales tax is imposed on consumers. What effect does this have on the industry demand curve? Find the new competitive price and output. Compare this answer to your findings in part (b). Problem 2The market for rice in an East Asian country has demand and supply given byQD = 28 − 4P (Demand)QS = −12 + 6P (Supply)where quantities denote millions of bushels per day.a. If the domestic market is perfectly competitive, find the equilibrium price and quantity of rice. Compute the triangular areas of consumer surplus and producer surplus.b. Now suppose that there are no trade barriers, and the world price of rice is $3. Confirm that the country will import rice. Find QD, QS, and the level of imports, QD − QS. Show that the country is better off than in part (a), by again computing consumer surplus and producer surplus.c.Thegovernmentauthoritybelievesstronglyinfreetradebutfeelspoliticalpressuretohelpdomesticricegrowers. Accordingly, it decides to provide a $1 per bushel subsidy to domestic growers. Show that this subsidy induces the same domestic output as in part (a). Including the cost of the subsidy, is the country better off now than in part (b)? Explain.Application scenariosThis week’s application case involves finding price/quantity (output) combinations in three situations. A common thread among the situations is that each occurs in a perfectly competitive market environment. Show your work and use Excel to the extent feasible to do calculations.Submit your Excel workbook to the Week 7 Pricing Case Dropbox.1. In 2012, the respective worldwide demand and supply curves for copper were:QD = 15 – 10P and QS= -3 + 14Pwhere Q is measured in millions of metric tons per year.A. Find the competitive price and quantity.B. Suppose that in 2013 demand is expected to fall by 20 percent. How much are world copper prices expected to fall?2. Swimming pool cleaning services are supplied by many small firms in the Atlanta area. Demand and supply conditions in the perfectly competitive market for these services are: P = $75 – 1.75QD (Demand) P = $2QS (Supply) where P is price per pool cleaned and Q is quantity of pools cleaned per day.A. Algebraically determine the equilibrium industry price/output combination. B. Confirm this by graphing industry demand and supply curves.3. Hall and Wallace, Inc., produces wiring modules for HVAC control systems used in large construction projects. Given vigorous import competition, prices are stable at $4,500 per unit in this dynamic and very competitive market. H & W’s annual total cost (TC) and marginal cost (MC) relations are: TC = $7,000,000 + $500Q + $0.5Q2 MC = ΔTC/ΔQ = $500 + $1Q where Q is output.Suppose the Occupational Health and Safety Administration (OSHA) has recently ruled that the company must install expensive new shielding equipment to guard against worker injuries. This will increase the marginal cost of manufacturing by $100 per unit. H & W’s fixed expenses, which include a required return on investment, will be unaffected.A. Calculate H & W’s profit-maximizing price/output combination and economic profits before installation of the OSHA-mandated shielding equipment. B. Calculate the profit-maximizing price/output combination and economic profits after H & W has met OSHA guidelines. C. Bonus Question: Compare your answers to parts A and B. Who pays the economic burden of meeting OSHA guidelines?