Identify: UIN:Problem Set #2 (50 Factors)AGEC 429Due Date: Tuesday, March 10, 2015On this task, you might be requested to investigate and calculate the influence of varied agricultural coverage devices on U.S.rice markets. In answering the questions, assume that you’re a coverage analyst working for the Secretary of Agriculture.The knowledge it’s worthwhile to reply the questions is given within the desk beneath. Word that portions are given in 1,000hundredweight (cwt) and costs are given in $/cwt. (FYI: a hundredweight is 100 lbs however you don’t have to know thatto work this downside set.) You could not want all the knowledge given within the desk for each Question Assignment. You should showyour work on a number of separate sheets and staple them to the issue set. NOTE: — = Not relevant.1. The Secretary of Agriculture is contemplating recommending a surplus buy program with a Help value of$14.00/cwt to the President however earlier than he does he desires you to find out how a lot rice the federal government will haveto buy to Help value at that degree and what the price to the federal government can be. Fill within the blanks beneath withyour solutions to the Secretary. Surplus to buy = Price to the federal government =2. Congressman Drinksalot is proposing a advertising mortgage program with the mortgage fee set at $14.00/cwt as a substitute of agovernment surplus buy program to Help value at $14.00/cwt as a result of he claims it’ll price the governmentless than a surplus buy program. The Secretary desires to know whether or not the Congressman is correct and asks youto calculate the price of the advertising mortgage program to the federal government. Fill within the blanks beneath along with your answersto the Secretary. Price of selling mortgage program to the federal government = Who’s proper – the Secretary or the Congressman?Rice Portions and PricespriceelasticitiesEquilibriumBeforeProgramsSupply (million cwt) Zero.28 189.886Demand (million cwt) -Zero.73 189.886Farm Value ($/cwt) — 10.00Shopper value ($/cwt) — 10.00Goal Value ($/cwt) — NoneSupport Value ($/cwt) — NoneGovernment Price (mil $) — None three. Senator Cityslicker doesn’t just like the Secretary’s authorities surplus buy program proposal or CongressmanDrinksalot’s advertising mortgage program as a result of she says each lead to an excessive amount of rice manufacturing and price an excessive amount of.She proposes a compulsory acreage discount program to push the worth of rice as much as $14.00/cwt. The Secretaryasks you to calculate the whole discount in rice provide that may be required to push value to $14.00/cwt underSenator Cityslicker’s plan assuming a four.5% slippage. He additionally asks you to investigate whether or not producers andconsumers can be higher off, worse off, or the identical with such a provide discount program in comparison with agovernment surplus buy program or a advertising mortgage program. Provide discount required = Within the desk beneath, point out whether or not producers and customers can be higher off, worse off, or the identical with anacreage discount program (ARP) in comparison with a authorities surplus buy (GSP) program and a marketingloan program (MLP) by evaluating producer surplus and shopper surplus in every case. Write “better”, “worse”,or “same” in every cell as applicable. (Use “shopper and producer surplus” ideas that can Help you reply).Producers ConsumersGSP as a substitute of an ARPMLP as a substitute of an ARP4. The U.S. Rice Producers Affiliation proposes a authorities funded promoting marketing campaign to advertise domesticrice consumption. They suggest that the slogan for the rice promotion program must be “Strive the sticky littlewhite stuff that many of the remainder of the world eats as a result of you’ll prefer it and apart from it’ll Help rice farmers.” (Timeto rent an promoting company to provide you with a greater slogan!) Anyway, the Secretary desires to know the way muchmore rice folks must eat to get the worth of rice as much as $14.00/cwt. Fill within the clean beneath along with your answerto the Secretary. Elevated consumption required =5. Congresswoman Knowitall doesn’t just like the coverage suggestions of the Secretary, Congressman Drinksalot,Senator Metropolis Slicker, or the U.S. Rice Producers Affiliation. She proposes a value loss protection (PLC) paymentprogram with a reference value of $14.00/cwt and a NR mortgage fee set at a a lot decrease $7.00/cwt security web levelbecause she says this program will decrease the worth to customers like Congressman Drinksalot’s proposed marketingloan program however can be cheaper than both the Secretary’s or Congressman Drinksalot’s applications. The Secretaryasks you to find out if she is correct. What would Congresswoman Knowitall’s proposed program price? Is Congress girl Knowit all proper?- Does her program decrease the worth to customers just like the MLP?- Is her program cheaper than the Secretary’s and the Congressman’s applications?6. A invoice for a authorities surplus buy rice program as proposed by the Secretary of Agriculture makes its waythrough the Senate whereas a invoice representing Congressman Drinksalot’s advertising mortgage rice program is handed bythe Home of Representatives. The 2 payments are despatched to a Convention Committee to craft a closing coverage. TheConference Committee proclaims that along with the applications proposed within the two payments, it’s also contemplating aproposal by Senator Hayseed, a member of the Convention Committee, to mix the proposed advertising loanrice program with Congresswoman Knowitall’s value loss protection (PLC) program with the reference value set at$14.00/cwt and the NR mortgage fee set at $9.00/cwt as a result of the Senator says it could be cheaper than both thegovernment surplus buy program or the advertising mortgage program by itself. The Secretary asks you if SenatorHayseed is right. What would you reply and why? 7. If the Convention Committee selects the least pricey program for the American taxpayer (of these they areconsidering), which one will they select? __________________________________________________________________________________________8. If the mortgage fee in Senator Hayseed’s mixed program was set at $7.00/cwt as a substitute of $9.00/cwt, what effectwould which have on the Convention Committee’s resolution about which program to pick out?

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