Microeconomics Answers

 For the price-taking “Baby Bell” firm, what is the equation of their individual demand curve?

The demand function for Product X is given by: Qd_x = 10 + 0.06I - 2P_x - 0.5P_y + 0.7P_z  where P_x  Price of good X $9.00 

P_y Price of related good Y  $4.00

P_z Price of related good Z $10.00 

I Income  $250.00 

a. (i) Calculate the own Price elasticity of demand (PED) for Good X.                           

Assume in a two-sector economy made up of agriculture and manufacturing, the government introduces a subsidy of y per hour on labour in the manufacturing sector. What will be the effect of the policy on the equilibrium wage, total employment as well as employment in agriculture and manufacturing?

Consider the following two-person simultaneous move game: column

left right up 7,3 a,a down a,a 7,3

row

Determine the Nash equilibrium/equilibria for any value of a.

b) Suppose 𝑎 = 4 will there be a Nash equilibrium in a sequential game? Assuming Column is the leader in this game show whether or not there is a Nash-equilibrium in this game

Assume the markets for cherries, muffins and tea are each perfectly competitive. (a) In the market for cherries, the equilibrium price is $1 per kilogram and the equilibrium quantity is 1000 kilograms. Calculate the price elasticity of supply if price increases to $1.20 causing the quantity supplied to increase to 1500 kilograms. 

Marginal rate of substitution indicates the slope of ........ *

Budget line

Price line

Indifference set

Indifference curve

1)  The price has just increased from $1.50 to $3. Calculate the price elasticity of demand at $1.50. Round your answer to 2 decimal places if necessary.

2)   At a price of $1.50 is price elasticity of demand elastic, unit elastic or inelastic? Explain your answer.

3)   Calculate the total expenditure on lattes at price $1.50 per latte.

Can you do a demand graph for this ty

Price QD

20 200

25 150

30 100

35 50

40 0