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1. A tour operating firm plans to take tourists between Addis Ababa and Jimma. its estimated cost function given by C =100 +50 N+4N2 (Where N denotes the number of passengers per day)
A. State the average cost function.
B. State the marginal cost of the average cost function.
C. Find the number of passengers per day that minimize average cost.
D. What is the minimum average cost at the optimal level of passenger?
E. What will be the total cost at the optimal level?
Suppose that William Berl, the manager of the Oldsmobile division of the General motors Corporation, has estimated the following regression equation for Oldsmobile
Q0 = 90,000 – 200P0 + 3,000N + 100I +50PC – 2,000Pg + 5A
Where Q0 = Quantity demand of Oldsmobiles per year
P0 = price of Oldsmobiles, in dollars
N = population of the United States, in millions
I = per capita disposable income, in dollars
PC = price of Chevrolet automobiles, in dollars
Pg= real price of gasoline, in cents per gallon
A = advertising expenditures by Oldsmobile, in dollars per year
a) Indicate the change in the number of Oldsmobiles purchased per year (Q0) for each unit change in the independent, or explanatory, variables.
b) Find the value of Q0 if the average value of PC = $10,000, N = 220 million, I = $12,000, P0 = $9,000, Pg = 100c, and A = $200,000.
c) Derive the equation for the demand curve for Oldsmobiles, and
d) Plot it
Suppose that the demand and supply for milk for Furi dairy farm is given by
where the quantity is in liters and the price is in birr per liter. Assume there is no import or export of milk.
A) Find the market equilibrium quantity, and the equilibrium price.
B) Find the consumer and producer surplus at the market equilibrium that you found in part (a).
C) Assume now that there is a price floor of 36 birr per liter. What is the new quantity sold in the market?
Given the following information answer each of the following questions: - Ca=20 c=MPC=3⁄4 Ia =I=20
If the consumption function of a given individual is given C= 44+0.86Yd and the individual’s disposable income for a specific period was birr 3600,
Assuming the economy was in a recession which was taken care of by the monetary sector through monetary expansion. Consider the short and long run effects of the policy on output, employment, interest rate and price level.
If the consumption function of a given individual is given C= 44+0.86Yd and the individual’s disposable income for a specific period was birr 3600, then calculate the
Given the following information answer each of the following questions: - Ca=20 c=MPC=3⁄4 Ia =I=20
When inflation gets very high, people do not like to hold money because it is losing value
quickly. Therefore, they spend it faster.
When the money supply is doubled, if people spend money more quickly, what happens to
prices? Do prices more than double, less than double, or exactly double? Explain using the
Quantity Theory of Money
Currently, we Ethiopian faced a problem of war in some part of Ethiopia such as State of Amhara, State of Afar and Tigray. This problem caused low production, output, high unemployment rate, low aggregate demand. The macroeconomics has considered the state of macroeconomics, the philosophies that have been most important in the 21th century. Given the situation, what would a state of macro economics recommend be done? And as off you what would be done?
