Consider the intertemporal allocation of a non-renewable natural resource.

(a) Describe the (marginal) conditions that a dynamically efficient allo cation must satisfy, carefully describing the relevant opportunity cost of a resource unit at a given period (including both extraction and user costs).

(b) Will the intertemporal allocation of the resource by a perfectly competitive market be dynamically efficient? Why?

(c) Focusing on the case in which the marginal cost of extraction is 0, argue that the intertemporal price path will satisfy the Hotellings Rule, relying on a no-arbitrage argument to justify it. Will the corresponding path of quantities extracted increase or decrease over time?

(d) Based on the Hotellings Rule, we might expect the price of non renewable resources to increase continually over time, as resource stocks are depleted. However, empirical evidence for a number of mineral resources suggests that prices have not been increasing monotonically over the past century. Try to explain this apparent anomaly between theory and observation.

5. Consider the following two-period model of dynamically efficient extraction of a non-renewable natural resource. The constant social marginal cost of extraction is 40 in each period and the total stock of the resource is Q = 300 units. Moreover, the social marginal benefit is MB(Qt) = 200Qt, where Qt is the quantity of resource extracted in period t, for t = 0; 1. The discount factor is 0:8.

(a) What is the efficient quantity of resource extracted in each period? Provide a graphical representation of the solution.

(b) What is the marginal user cost (or scarcity rent) of the resource in each period?

(c) Suppose that there is a market to trade the resource. What is the equilibrium price corresponding to each period? Justify the answer.

(d) Suppose that it is now expected that because of an extraction technology improvement, while the worst period marginal cost of extraction will still remain MXC1 = 40, the second period one will now de crease to MXC2 = 20. Answer the previous questions (a)-(c) under this alternative premise.

(e) How will the answers to questions (a)-(c) change if, because of new discoveries, the known reserves of the natural resource become Q = 400

Question 1 aj Jane bought 1 bottle of seaweed-based shampoo. She gave the bottle to her sister, Jill, After using the shampoo Jill discovered to her horror that her hair, which was usually healthy, was starting to fall out and that she had contracted a skin rash on her neck. Analysis reveals that the shampoo in fact contained small amounts of harmful chemicals. Advise Jill whether she can take action against the manufacturer, Tulin Products Son Bhd. 30 marksQUESTION ONE [20] Every contract consists of an offer made by one party and accepted by another. An offer may be defined as a proposal which expresses a person's willingness to become a party to a contract, according to the terms expressed, Acceptance of the offer by another person binds both contractually Discuss the rules in relation to offer and acceptance and provide examples to support your answerQuestion 39 Not yet answered Marked out of 1.00 P Flag question "To provide better guidelines on standard cost accounting practices", is one of the objectives of a manufacturing firm that can be achieved through O a. Cost Accounting Standards O b. Generally Accepted Accounting Principles O . Charted Accounting Institute Standards O d. International Financial Reporting StandardsPathway Trace Starting from this material: OH NH: Follow a route of substrates and enzymes to go from this amino acid to pyruvate. When converting from an amino acid to another amino acid transaminase is acceptable. You have acetyl-Con If needed as well as erythrose-4-phosphate if needed. First what is the name of the amino acid: glutamine Enzyme Product transaminand Acyl Con Inthetan Acyl Cod dehydrog Frapl Cas Eroyl Col hydrates B.butothiolase AcetylCeA Citrate venthing Next a shuttle step occurs that we're going to Ignore. Now back to the pathway