{"id":235,"date":"2008-02-29T00:56:11","date_gmt":"2008-02-29T04:56:11","guid":{"rendered":"https:\/\/freedom24.org\/rationalpost\/2008\/02\/29\/question-3\/"},"modified":"2010-11-06T14:55:22","modified_gmt":"2010-11-06T18:55:22","slug":"question-3","status":"publish","type":"post","link":"https:\/\/freedom24.org\/rationalpost\/question-3\/","title":{"rendered":"question 3"},"content":{"rendered":"<p style=\"font-style: italic;\"><a href=\"http:\/\/reporter.blogs.com\/photos\/uncategorized\/2008\/04\/17\/xanadu.jpg\" data-rel=\"lightbox-image-0\" data-rl_title=\"\" data-rl_caption=\"\"><img decoding=\"async\" class=\"alignright size-full wp-image-1210\" title=\"\" src=\"https:\/\/freedom24.org\/rationalpost\/wp-content\/uploads\/2008\/02\/xanadu.jpg\" alt=\"xanadu\" width=\"250\" srcset=\"https:\/\/freedom24.org\/rationalpost\/wp-content\/uploads\/2008\/02\/xanadu.jpg 300w, https:\/\/freedom24.org\/rationalpost\/wp-content\/uploads\/2008\/02\/xanadu-221x300.jpg 221w\" sizes=\"(max-width: 300px) 100vw, 300px\" \/><\/a>An excerpt from the mid-term &#8220;problem set&#8221; in <a href=\"http:\/\/www.hks.harvard.edu\/degrees\/teaching-courses\/course-listing\/iga-310\" target=\"_blank\">ENR-302<\/a>&#8230;<\/p>\n<p>3. The country of Xanadu is dependent of the use of domestically produced methanol for 100% of its energy needs. The price of methanol is set by a competitive market and the fuel is priced at $2.50 per gallon. Two large companies supply 80% of the market and each has costs of $1.50 per gallon.  The opposition party and most of the national labor unions argue that these two companies are making obscene profits. They demand that the President place a mandatory price cap of $2.00 on the price of methanol to prevent &#8220;this abuse of market power.&#8221;<\/p>\n<p>Assume that the elasticity of demand is 0.4 and the elasticity of supply is 0.8. Discuss in 250 words or less, the impact on supply and demand, if the President gives in and caps the price of methanol at $2.00 per gallon. Explain your answer.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>An excerpt from the mid-term &#8220;problem set&#8221; in ENR-302&#8230; 3. The country of Xanadu is dependent of the use of domestically produced methanol for 100% of its energy needs. The price of methanol is set by a competitive market and the fuel is priced at $2.50 per gallon. Two large companies supply 80% of the [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_exactmetrics_skip_tracking":false,"_exactmetrics_sitenote_active":false,"_exactmetrics_sitenote_note":"","_exactmetrics_sitenote_category":0,"_s2mail":"","footnotes":""},"categories":[2,4],"tags":[118,90,17,33,32,58],"class_list":["post-235","post","type-post","status-publish","format-standard","hentry","category-finance-economics","category-world-affairs","tag-energy","tag-geopolitics","tag-policy","tag-regulation","tag-theory","tag-trade"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v26.5 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>question 3 - The Rational Post<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/freedom24.org\/rationalpost\/question-3\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"question 3 - The Rational Post\" \/>\n<meta property=\"og:description\" content=\"An excerpt from the mid-term &#8220;problem set&#8221; in ENR-302&#8230; 3. The country of Xanadu is dependent of the use of domestically produced methanol for 100% of its energy needs. The price of methanol is set by a competitive market and the fuel is priced at $2.50 per gallon. Two large companies supply 80% of the [&hellip;]\" \/>\n<meta property=\"og:url\" content=\"https:\/\/freedom24.org\/rationalpost\/question-3\/\" \/>\n<meta property=\"og:site_name\" content=\"The Rational Post\" \/>\n<meta property=\"article:published_time\" content=\"2008-02-29T04:56:11+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2010-11-06T18:55:22+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/freedom24.org\/rationalpost\/wp-content\/uploads\/2008\/02\/xanadu.jpg\" \/>\n<meta name=\"author\" content=\"The Editor\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"The Editor\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"1 minute\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/freedom24.org\/rationalpost\/question-3\/\",\"url\":\"https:\/\/freedom24.org\/rationalpost\/question-3\/\",\"name\":\"question 3 - The Rational Post\",\"isPartOf\":{\"@id\":\"https:\/\/freedom24.org\/rationalpost\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/freedom24.org\/rationalpost\/question-3\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/freedom24.org\/rationalpost\/question-3\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/freedom24.org\/rationalpost\/wp-content\/uploads\/2008\/02\/xanadu.jpg\",\"datePublished\":\"2008-02-29T04:56:11+00:00\",\"dateModified\":\"2010-11-06T18:55:22+00:00\",\"author\":{\"@id\":\"https:\/\/freedom24.org\/rationalpost\/#\/schema\/person\/283fe28dc4dbcdd4b4cf199931549e0b\"},\"breadcrumb\":{\"@id\":\"https:\/\/freedom24.org\/rationalpost\/question-3\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/freedom24.org\/rationalpost\/question-3\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/freedom24.org\/rationalpost\/question-3\/#primaryimage\",\"url\":\"https:\/\/freedom24.org\/rationalpost\/wp-content\/uploads\/2008\/02\/xanadu.jpg\",\"contentUrl\":\"https:\/\/freedom24.org\/rationalpost\/wp-content\/uploads\/2008\/02\/xanadu.jpg\",\"width\":\"300\",\"height\":\"406\"},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/freedom24.org\/rationalpost\/question-3\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\/\/freedom24.org\/rationalpost\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"question 3\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\/\/freedom24.org\/rationalpost\/#website\",\"url\":\"https:\/\/freedom24.org\/rationalpost\/\",\"name\":\"The Rational Post\",\"description\":\"A collection of essays and articles on the science of everyday life\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\/\/freedom24.org\/rationalpost\/?s={search_term_string}\"},\"query-input\":{\"@type\":\"PropertyValueSpecification\",\"valueRequired\":true,\"valueName\":\"search_term_string\"}}],\"inLanguage\":\"en-US\"},{\"@type\":\"Person\",\"@id\":\"https:\/\/freedom24.org\/rationalpost\/#\/schema\/person\/283fe28dc4dbcdd4b4cf199931549e0b\",\"name\":\"The Editor\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/freedom24.org\/rationalpost\/#\/schema\/person\/image\/\",\"url\":\"https:\/\/secure.gravatar.com\/avatar\/f86e535a97f912bdd424fbc1e2e03c7cd61d620df1d67992619d98e857242139?s=96&d=mm&r=g\",\"contentUrl\":\"https:\/\/secure.gravatar.com\/avatar\/f86e535a97f912bdd424fbc1e2e03c7cd61d620df1d67992619d98e857242139?s=96&d=mm&r=g\",\"caption\":\"The Editor\"},\"description\":\"Founder of Freedom24\",\"sameAs\":[\"http:\/\/www.rationalpost.com\"],\"url\":\"https:\/\/freedom24.org\/rationalpost\/author\/admin\/\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"question 3 - The Rational Post","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/freedom24.org\/rationalpost\/question-3\/","og_locale":"en_US","og_type":"article","og_title":"question 3 - The Rational Post","og_description":"An excerpt from the mid-term &#8220;problem set&#8221; in ENR-302&#8230; 3. The country of Xanadu is dependent of the use of domestically produced methanol for 100% of its energy needs. The price of methanol is set by a competitive market and the fuel is priced at $2.50 per gallon. Two large companies supply 80% of the [&hellip;]","og_url":"https:\/\/freedom24.org\/rationalpost\/question-3\/","og_site_name":"The Rational Post","article_published_time":"2008-02-29T04:56:11+00:00","article_modified_time":"2010-11-06T18:55:22+00:00","og_image":[{"url":"https:\/\/freedom24.org\/rationalpost\/wp-content\/uploads\/2008\/02\/xanadu.jpg","type":"","width":"","height":""}],"author":"The Editor","twitter_misc":{"Written by":"The Editor","Est. reading time":"1 minute"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"WebPage","@id":"https:\/\/freedom24.org\/rationalpost\/question-3\/","url":"https:\/\/freedom24.org\/rationalpost\/question-3\/","name":"question 3 - The Rational Post","isPartOf":{"@id":"https:\/\/freedom24.org\/rationalpost\/#website"},"primaryImageOfPage":{"@id":"https:\/\/freedom24.org\/rationalpost\/question-3\/#primaryimage"},"image":{"@id":"https:\/\/freedom24.org\/rationalpost\/question-3\/#primaryimage"},"thumbnailUrl":"https:\/\/freedom24.org\/rationalpost\/wp-content\/uploads\/2008\/02\/xanadu.jpg","datePublished":"2008-02-29T04:56:11+00:00","dateModified":"2010-11-06T18:55:22+00:00","author":{"@id":"https:\/\/freedom24.org\/rationalpost\/#\/schema\/person\/283fe28dc4dbcdd4b4cf199931549e0b"},"breadcrumb":{"@id":"https:\/\/freedom24.org\/rationalpost\/question-3\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/freedom24.org\/rationalpost\/question-3\/"]}]},{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/freedom24.org\/rationalpost\/question-3\/#primaryimage","url":"https:\/\/freedom24.org\/rationalpost\/wp-content\/uploads\/2008\/02\/xanadu.jpg","contentUrl":"https:\/\/freedom24.org\/rationalpost\/wp-content\/uploads\/2008\/02\/xanadu.jpg","width":"300","height":"406"},{"@type":"BreadcrumbList","@id":"https:\/\/freedom24.org\/rationalpost\/question-3\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/freedom24.org\/rationalpost\/"},{"@type":"ListItem","position":2,"name":"question 3"}]},{"@type":"WebSite","@id":"https:\/\/freedom24.org\/rationalpost\/#website","url":"https:\/\/freedom24.org\/rationalpost\/","name":"The Rational Post","description":"A collection of essays and articles on the science of everyday life","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/freedom24.org\/rationalpost\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-US"},{"@type":"Person","@id":"https:\/\/freedom24.org\/rationalpost\/#\/schema\/person\/283fe28dc4dbcdd4b4cf199931549e0b","name":"The Editor","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/freedom24.org\/rationalpost\/#\/schema\/person\/image\/","url":"https:\/\/secure.gravatar.com\/avatar\/f86e535a97f912bdd424fbc1e2e03c7cd61d620df1d67992619d98e857242139?s=96&d=mm&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/f86e535a97f912bdd424fbc1e2e03c7cd61d620df1d67992619d98e857242139?s=96&d=mm&r=g","caption":"The Editor"},"description":"Founder of Freedom24","sameAs":["http:\/\/www.rationalpost.com"],"url":"https:\/\/freedom24.org\/rationalpost\/author\/admin\/"}]}},"_links":{"self":[{"href":"https:\/\/freedom24.org\/rationalpost\/wp-json\/wp\/v2\/posts\/235","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/freedom24.org\/rationalpost\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/freedom24.org\/rationalpost\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/freedom24.org\/rationalpost\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/freedom24.org\/rationalpost\/wp-json\/wp\/v2\/comments?post=235"}],"version-history":[{"count":4,"href":"https:\/\/freedom24.org\/rationalpost\/wp-json\/wp\/v2\/posts\/235\/revisions"}],"predecessor-version":[{"id":1209,"href":"https:\/\/freedom24.org\/rationalpost\/wp-json\/wp\/v2\/posts\/235\/revisions\/1209"}],"wp:attachment":[{"href":"https:\/\/freedom24.org\/rationalpost\/wp-json\/wp\/v2\/media?parent=235"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/freedom24.org\/rationalpost\/wp-json\/wp\/v2\/categories?post=235"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/freedom24.org\/rationalpost\/wp-json\/wp\/v2\/tags?post=235"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}