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Which of the following statements are true in the long-run equilibrium of a perfectly competitive market economy? (Choose “True” or “False”) (a) By re-allocating the inputs, the economy can produce a larger quantity of every consumption good.
Q1)
Pa | Qda | Qdb | I
----------|------------ |------------|-------------
6.0 | 100 | 20 | 2000
| | |
6.5 | 90 | 30 | 1800
| | |
7.0 | 70 | 50 | 1600
| | |
7.5 | 40 | 70 | 1400
| | |
8.0 | 10 | 85 | 1200
where, Pa = Price of A
Qda = Quantity demand for A
Qdb = Quantity demand for B
I = Income
On the basis of the above data, answer the following questions: -
(i) If income increases from $ 1000 to $ 2000, from the above table estimate the elasticity of demand.
(ii) Compute the income elasticity of demand for A & B when income of consumer increases from $ 1400 to $ 1800. Also interpret the result and explain the result by the method of a diagram.
Q2) If quantity demand for chicken increases by 20% when price of beef increases from 0.4 penny to 0.5 penny, then compute the cross price elasticity from chicken to beef.
The equation of an estimated demand function is as follows: -
QdA (Quantity demand for A) = 200.5 - 2.5 Pa - 1.5Pb + 3.5 I
where, Pa = Price of A
Pb = Price of B [It is a related product]
I = Income
(i) Determine the demand when Pa = $ 500, Pb = $ 100 and I = $ 3000
(ii) Estimate the price elasticity, cross-price elasticity and income elasticity of the demand according to point method.
(iii) Estimate the elasticity of the demand according to proportion method if Pa2 = $ 515, Pb2 = $ 105 and I = $ 3500.
The demand function of a product is as follows: -
qa = 200.5 - 3.5Pa + 2.5I
and, Pa = $ 50 and I = $ 1000
(i) Compute the demand when P = $ 60 and 'I' is constant.
(ii) Compute the demand with P = $ 50 and I = $ 1500.
(iii) Explain this phenomenon by the help of a diagram by the method of change in demand and shift in demand.
1. If the supply function of a firm is given as follows: -
S = 200.25 + 4.5P
Interpret the supply function and explain by the help of a diagram.
2. Given da (Demand of a) = 200.5 + 3.5I. Suppose this is an income demand function, interpret the result and show by the help of a diagram.
is Q= L ^0.75 K^0.5 and if price of labor per day is 5 birr and price of capital per day is 10 birr; and if total outlay (cost budget) per day is 400 birr,
A.Find L and K that maximize out put
B.What is the maximum out put the equilibrium L* and K*
Briefly explain by means of example the difference between a maximum price and a minimum price
Assume there's an increase in the price of the wood used in the production of kitchen tables. Illustrate and explain how this would impact the equilibrium price and quantity of kitchen tables.
Qx= 1.0- 2.0Px + 1.5I + 0.8Py- 3.0Pm+ 1.0A
Calculate sales
Write an argumentative essay on: The impact of COVID-19 pandemic on the Transport / Logistics industry.
Think about the important aspects of the topic and brainstorm some ideas such as the merits, challenges and solutions. Research the topic extensively and prepare an ARGUMENTATIVE essay on it.
(50 marks) please provide intext references as well as references.
#333702 on Dec 2022