The world price of wine is below the price that would prevail in Canada in the absence of trade. a. Assuming that Canadian imports of wine are a small part of total world wine production, draw a graph for the Canadian market for wine under free trade. Identify consumer surplus, producer surplus, and total surplus in an appropriate table. b. Now suppose that an unusual shift of the Gulf Stream leads to an unseasonably cold summer in Europe, destroying much of the grape harvest there. What effect does this shock have on the world price of wine? Using your graph and table from part (a), show the effect on consumer surplus, producer surplus, and total surplus in Canada. Who are the winners and losers? Is Canada as a whole better or worse off?
Meghan Field Q1. As you know, one of the board's responsibilities is to ensure that managers are reasonably paid (not overpaid or underpaid). A Firm’s CEO’a pay went up 25 % from 2011 to 2012 while her firm’s ROA went down by 4% and her firm’s stock return went down by 6% over this same period.Discuss (giving me at least 3 reasons) why despite the numbers the CEO may NOT be overpaid for this period. 1. The company may have done really well in the past so it could be coming down from the high but that doesn’t mean that the company is doing bad. 2. They could have put money toward investments for the future which could pull down the ROA now but could benefit the company later therefore the CEO did a good job. 3. The CEO could be getting more money bec