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1 The Subsidy and the ZEV Market (30 points) I am trying to get a better understanding of how this new mandate will impact Canada's
1 The Subsidy and the ZEV Market (30 points) I am trying to get a better understanding of how this new mandate will impact Canada's ZEV market. I know that for some years, the federal and most provincial governments have offered incentives for consumers who buy ZEVs. The Federal government currently provides a subsidy of up to $5,000 on the purchase of new ZEV; this rebate only applies to cars under $45,000, for the most part. There are a limited number of rebates available in that the incentive program has limited funds. Before the mandate's new funding, there was only enough for 120,000 vehicles, assuming $5,000 for each new car sold. Tesla's business is directly related to this topic. I need my Chief Economist to explain the elements of ZEV market and the possible consequences of the new mandate for Tesla's revenue. In doing so, keep in mind the following (but do not limit yourself to this list, it is by no means comprehensive): . The market demand for a ZEV with and without the ZEV subsidy . The impact of the cutoff price (under $45,000) on vehicles eligible for the subsidy . How will the subsidy affect market supply in the short and long run? . The effect of the mandatewhich is essentially a ban on lightduty vehicles that are not zeroemission after 2035ion consumers . Consequences for Tesla's revenue Your Role In this assignment, you will act as an applicant for the Chief Economist role at Tesla, using your knowledge from ECO200. Let's see if you can get the position! In your writing assignment, you should analyze the scenario using the tools we have discussed in ECO200. You may assume that your audience has also had EC0200. This means that you should model and describe the situation under consideration using tools we have discussed, and analyze the predictions of that model as it relates to the policy objectives. You should be clear about what you are considering when making your policy recommendations, and how those factors impact your decision. If you make any additional assumptions (beyond those mentioned above), you should clearly state them and, if relevant, address what would happen if those assumptions do not hold. In this section, you may use technical terms, such as \"deadweight loss\
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