Microeconomics Answers

Questions: 11 788

Answers by our Experts: 11 490

Need a fast expert's response?

Submit order

and get a quick answer at the best price

for any assignment or question with DETAILED EXPLANATIONS!

Search & Filtering

The market demand curve for a product is given by

DD: p=200-q

ss:p=50+0.5q


The market demand curve for aproduct is given by DD: p=200-q


20 goods without substitute (examples of inelastic goods)




1.    Suppose the following information is true for country A:

 

a.    Average annual income :                                 $6,500 per family

b.    Average consumption of meat:                        200 pounds

c.    Estimated income elasticity of demand:          10

d.    Average price per pound of meat:          $1.00

e.    Population composed of one million families

Let us assume that the government wants to provide adequate nutrition to the families so that each family is able to afford 250 pounds of meat per year. This can be done by transferring income to the families by the government.

By using the above information, compute the cost of this program.


1.    Assume that in 2018 only 1,000 UHV students sign up for the 1,500 positions in UHV residence halls at a set contract price of $3,000 per year.

 

a.    If UHV lowers the contract price to $2,500/year and 500 more students sign up, what is the price elasticity of demand for residence hall positions? You must show your work.

b.    Depict the situation on a supply and demand graph. Be sure to label your graph.

c.    With the information about demand elasticity, if the university president asked for your advice, would you recommend the price be cut, or not?


Find the slope of an assumed linear demand curve for theater tickets, when persons purchase 1000 at $5.00 per ticket and 200 at $15.00 per ticket

List ten goods without close substitute

Problem two: Aluminium pricing

For this question, refer to the article from The Economist magazine titled “A coup in

Guinea adds fuel to aluminium’s red-hot rally”.

a) The article identifies a number of factors behind the recent increase in the price of

aluminium. Mention these factors and indicate whether they are demand-side or supplyside factors.

2

b) With the aid of a well-labeled diagram, illustrate the effects of the factors identified

in part (a) above on the equilibrium price and quantity of aluminium. Pay attention to

the statement in the article that “Supply constraints, however, have been more

important” when drawing your diagram.


For an enterprise, each worker gets $50 per day and the constant cost of this


enterprise is $300. Find the Average Product (AP), Marginal Product (MP),


Variable Cost (VC), Total Cost (TC), and Marginal Cost (MC). Show all of your


calculations. Explain the calculations of each.




Number of Labor


1

2

3

4

5


Total Product


3

6

8

10

11



The table below lists the price and consumption levels of food and clothing during 2010 and 2020. Calculate a Laspeyres and Paasche index using 2010 as the base year (round your answer to three decimal points). [4] Year Prices Consumption Food Clothing Food Clothing 2010 500 300 200 85 2020 625 335 210 97