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    (Original post by spikez)
    so the demand curve (where mpb=msb) would shift in?
    MSB would shift in.
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    (Original post by spikez)
    in a normal negative externality diagram with the deadweight loss, you draw another supply curve between s1 (mpc) and s2 (msc). and then this will cut through and reduce the deadweight welfare loss.
    I was thinking about doing that but I've never seen it done before. Sounds interesting, do you happen to have a link to such an example?
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    nope sorry. i think it is in the tutor2u tool kit otherwise ill send it you tomorrow if scanner works.
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    (Original post by spikez)
    in a normal negative externality diagram with the deadweight loss, you draw another supply curve between s1 (mpc) and s2 (msc). and then this will cut through and reduce the deadweight welfare loss.
    Do you mean like in transport (2885) when the government impose a road user charge (pricing) so as to make the user pay for the negative externalities they are causing.
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    (Original post by spikez)
    nope sorry. i think it is in the tutor2u tool kit otherwise ill send it you tomorrow if scanner works.
    Ah, thanks then
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    (Original post by thewait)
    Do you mean like in transport (2885) when the government impose a road user charge (pricing) so as to make the user pay for the negative externalities they are causing.
    yeah, exactly that
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    I hate OCR.

    Confident?
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    (Original post by spikez)
    yeah, exactly that
    Are you talking about this diagram, and then shifting in PMC:
    http://www.thestudentroom.co.uk/showthread.php?t=918908

    I wish I did Transport now
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    (Original post by BJP)
    I hate OCR.

    Confident?
    If I manage to sort biofuels I reckon the exam will be nice and easy.
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    (Original post by vinsta)
    If I manage to sort biofuels I reckon the exam will be nice and easy.
    Sweet. I keep telling myself: "the whole point of them giving us a case-study is that they'll ask us questions about it"...let's just bloody hope they do.

    What's the issue with biofuels at the moment??
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    is an externality diagram the same as the market failure diagram?
    because when i googled 'market failure diagram' it was...
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    What about if the first 6 marks, were one markers, e.g. "which treaty was signed in 1957?" :tongue:
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    (Original post by BJP)
    What about if the first 6 marks, were one markers, e.g. "which treaty was signed in 1957?" :tongue:
    i'd stick my pen through my temple....:sadnod:
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    (Original post by BJP)
    Sweet. I keep telling myself: "the whole point of them giving us a case-study is that they'll ask us questions about it"...let's just bloody hope they do.

    What's the issue with biofuels at the moment??
    I can't get my head around the negative externalities bit, and the policies of the US and EU are exactly the same- use subsidies!!
    Most of the effects they give you in the tutor2u booklet are about bloody carbon-it's not bloody chemsitry!!
    I'm just hacing trouble writing about the economics of it.
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    (Original post by BJP)
    What about if the first 6 marks, were one markers, e.g. "which treaty was signed in 1957?" :tongue:
    It won't. They may put something in on command economies though. But I doubt it.
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    (Original post by vinsta)
    Are you talking about this diagram, and then shifting in PMC:
    http://www.thestudentroom.co.uk/showthread.php?t=918908

    I wish I did Transport now
    shift in mpc to the left, not to the right
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    (Original post by spikez)
    shift in mpc to the left, not to the right
    Thanks, but why does PMC shift to the left? Is it because biofuels means less emitting of CO2 in the atmosphere so MPC lowers because of the subsidy?
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    where does the subsidy come into this? im confused about it now ill have to ask someone else.

    With question 2 on the tutor2u mock, do you just draw a normal supply and demand diagram with supply shifting in? and how many/what explanations do you give?
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    (Original post by spikez)
    where does the subsidy come into this? im confused about it now ill have to ask someone else.

    With question 2 on the tutor2u mock, do you just draw a normal supply and demand diagram with supply shifting in? and how many/what explanations do you give?
    The biofuels policy is to use a subsidy to increase production of biofuels.

    Yeah and it says do supply shifting in as the most important.
    Talk about oil prices, monopoly power by russian monopolies to lower supply to increase prices, increase in demand from china and india.
    About 3 points should be fine.
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    (Original post by vinsta)
    Thanks, but why does PMC shift to the right? Is it because biofuels means less emitting of CO2 in the atmosphere so MPC lowers because of the subsidy?
    I'm pretty sure MPC shifts to the left not to the right, MPC represents overproduction when only private costs are considered, MSC is the social optimum so you want to shift MPC until MPC=MSC. I don't know if I explained that well. :o:
 
 
 

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