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Which one of the following is a microeconomic issue?
- The rate of economic growth in Japan.
- The South African inflation rate.
- The price of maize in Lesotho.
- The unemployment rate in Zimbabwe.
- The total production of goods and services in Zambia.
2. Kapoor Denims Inc. manufactures denim fabric. 20 metres
of the fabric is sold at Rs 8000. Fixed costs is Rs 20 lacs per
production period and the profit contribution is 40 percent of
price. (20 marks)
a.
Determine the BEP.
b.
Determine the Profit/loss at output of 8,000, 10,000
and 15,000 units.
C.
For the next production period, fixed costs will
increase to 30 lacs due to a major capital investment
programme, but the new and more efficient machinery will
result in a lower variable production cost so that variable cost
per metre will be reduced by 40 percent. If price is
unchanged, re-compute the profit /loss at output rate of 8,000,
10,000 and 15,000 units
The fundemental problem in economics is...
The following table showed the cross price elasticities between price of product X with the quantity demanded for product Y, Z, R, and S, respectively.
Types of Product cross price elasticities Y2.5Z0.1R-0.5S0.0
The conclusion is _________________________.
Select one:
a.
product Y and X is complement product.
b.
R and X is complement product.
c.
Product X and R is substitution product.
d.
Y and S is substitution product.
A firm currently employs 30 workers at a daily wage rate of $40. It calculates that the marginal cost per day of hiring an additional worker would be $102.
By how much would the daily wage rate have to be increased to attract an extra worker?
The schedule shows the short run marginal costs of producing good X.
Units of X 1 2 3 4 5
Marginal cost ($) 40 30 30 60 120
Given that the total fixed cost is $20, calculate the level of output which minimises Average Total Cost (ATC).
suppose the shortrun market price a competitive firm faces is birr 9 and the total cost of the firm is tc-200+q+0.02qanswer the quetions follow
a)calculate the short run equilibrium out put and profit of the firm
b)drive the mc atc and avc
A heat exchanger is being installed as part of a plant modernization program. It costs $80,000, including
installation, and is expected to reduce the overall plant fuel cost by $20,000 per year. Estimates of the
useful life of the heat exchanger range from an optimistic 12 years to a pessimistic 4 years. The most
likely value is 5 years. Assume the heat exchanger has no salvage value at the end of its useful life.
Determine the pessimistic, most likely, and optimistic rates of return.
The table shows the output of chairs at a factory when different numbers of workers are employed.
Number of workers 1 2 3 4 5
Number of chairs produced 6 17 27 32 30
Show where diminishing marginal returns to labour will set in.
The table shows a firm’s total and marginal costs.
Output Total cost ($) Marginal cost ($)
1 200 20
2 215 15
3 225 10
4 240 15
5 260 20
Calculate the Average Fixed Cost (AFC) of producing 6 units of output.
