Search & Filtering
Demand and supply equations for housing market per month are given below.
β’ Demand for housing: ππ· = 2500 β 0.5 π
β’ Supply of housing: ππ = β500 + π
a) Draw the demand and supply curves for housing market in one graph.
b) Find the equilibrium quantity and price for housing.
c) Compute the consumer and producer surplus in equilibrium.Β
d) Suppose that the government set a rent ceiling at $1800. What are the quantities ofΒ
housing supplied and demanded at this price? In this case, is there a shortage orΒ
surplus of houses?
e) How does the price ceiling affect the efficiency in the housing market?
f) Calculate the deadweight loss in the housing market after the price ceiling isΒ
imposed by the government.
g) Calculate the potential spending for housing search activities
A Consumer consumed 3 units of a product. Marginal Utilities derived from the first two units are βΉ500 and βΉ400. If the price of the product is βΉ300 per unit and the Consumer is in equilibrium at 3 units, the Consumer Surplus will be ______Β
Briefly explain the reason/s that ice cream is sold at a discount in November
Why measuring price, income, cross and advertisement elasticities of demand for an
insurance product is good for the growth of the sector? Use supply and demand curves to
illustrate how each of the following events would affect the price/ or premium and quantity of
a private health insurance policy a) if you get benefits under health insurance plan of the state
government b) a decrease in your average income level during pandemic c) if policy
premiums are expected to increase in coming future and d) if more tax benefits are provided
for taking this policy.
Which competitive markets can use price discrimination as a pricing strategy and why?
In what ways three degrees of price discrimination are different from each other? How can
insurance industry use this practice in extracting surpluses from consumers?
Construct graph and explain income and substitution effect of a price change for food
(on X-axis) and cloth (on Y-axis) when a) food is a normal good and b) food is an inferior
good. Suppose price of food is continuously decreasing, with no change in the price of cloth
and income, what curves can you derive from this change?
Discuss how management utility maximization goal of a firm create principal-agent
problem? How can this problem be solved in an insurance company? A monopolist has a cost
function 200q + 15Q2
and faces a demand function given by P= 1200 β 10Q. Calculate total
revenue, marginal revenue, output and price that maximize profit-maximizing? What is its
maximal profit? Explain with the help of graphs?
Use the demand function below to answer the questions that follow
πΈπ π = π β π π·π β ππ·π + ππ·π β π π΄ ππ ππ
Where π·π and π·π are prices of related goods and M is income. Using the demand function;
I. Identify which type of goods is π·π and explain it
II. Identify which type of goods is M and explain it
III. Identify which type of goods is π·π and explain it
IV. Interpret π·π
) Given the supply function, P = 500 + 2Q, where P is the price of a bottle of a perfume,
Q is the number of litres supplied.
(a) Graph the supply function. What is the meaning of value of the vertical intercept.
(b) What is the value of Q when P = k750?
When the marginal cost curve is above the average total cost curve:
Β
A.Β Β the average fixed cost curve is rising.
Β
B.Β Β the average fixed cost curve is horizontal.
Β
C.Β Β the marginal cost curve is falling.
Β
D.Β Β the marginal cost curve reaches a minimum.
Β
E.Β Β the average total cost curve is rising.
