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Economics Assignment: Equilibrium Price and Quantity

   

Added on  2020-06-06

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INDIVIDUALASSIGNMENT
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Table of ContentsINTRODUCTION...........................................................................................................................1TASK 1............................................................................................................................................1a) Explaining tax on Procedures................................................................................................1b) Quotas.....................................................................................................................................2c) Equilibrium price and quantity...............................................................................................3TASK B...........................................................................................................................................5TASK C...........................................................................................................................................7TASK D...........................................................................................................................................8CONCLUSION ...............................................................................................................................9REFRENCES.................................................................................................................................10
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INTRODUCTIONThe vital areas of economics are linked with identification of conflicts that arise ineconomy. There are various political and social factors which are related with the main cause ofconflicts but we are having our main focus on the economic causes. The main objective of this islinked with exploration of link course between violence and the economical activities. In thisreport, studies are made about harvesting of mahogany plant which are available in Brazilianforest. This plant is important value and it looks very beautiful. The main producer who growsthis plant is Brazil. We will discuss that illegal harvesting of mahogany had the situation ofincrease in homicide. When any of the activities become illegal than there is no system called asjustice and the conflicts are settled with the help of violence in economy.TASK 1a) Explaining tax on proceduresThe harvesting of mahogany was affected after the government introduced tax policies asthey had to pay compulsory tax on export and import of these products. Before conditions whenthe tax plans were not introduced, Brazilian people were harvesting their plants rigidly as theywere not having any restrictions.Taxation impact on equilibrium prices: It refers to the situation where prices of productsare equivalent to demand and supply factor in economy. This can also be analysed as thesituation where quantity demanded is equal to supply ratios. From the above graph, it can beevaluated that the point where demand and supply curve are meeting that point is called asequilibrium.
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Quantity Traded: It refers to economic policy where factors of production are broughtand they are sold to the customers in market. In most of the market areas, amount of quantitytraded will depend on the equilibrium situation in economy where demand and supply curve areinteracting. This is useful in the evaluation of market prices.Welfare Economics: They are called as subdivision of economics to find out the welfarelevels in economy. It starts when the functions linked with welfare are divided which are usedfor ranking resource allocation in economy.b) QuotasQuotas: It is the limit which is imposed on the products which are exported to country.When there is no trading, the market prices of equilibrium will occur at domestic supplyand demand rates. The prices of products in the world will be lower than the prices of thosecountries which are not involved in trading. If there is free trading from countries in rest of theworld, then supply curve will be perfectly elastic.If quotas are imposed then there is shortage of products and prices goes high as the sumtotal of all outputs will decrease. The amount of fall is relevant with the level of quota. As theprice increases, there are incentives for domestic organisation as they can increase their outputs.Welfare Economics: As the quotas are imposed, there will be increase in the welfare ofeconomy as domestic firms will have opportunities to sell their products due to imposed limits.2
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