Answer to Question #128054 in Microeconomics for Samuel

Question

1. a) Explain the concept of scarcity, choice and opportunity cost.

b) Illustrate & explain the maximum and minimum price fixation by government.

c) Distinguish between a shift in demand and a movement along the demand curve.

    2. a) Explain clearly the determinants of demand for a commodity.

      b) Calculate the price elasticity of demand for the product X & Y

Price of product/Unit of X Quantity Demanded of X

100 100

120 20

Price of product/Unit of Y Quantity Demanded of Y

100 20

200 15

     c) The demand and supply functions are given as follows;

        Qd=1000-60P and Qs=600+40P

         Determine the Equilibrium price and quantity. 

Answer 1

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