Microeconomics Answers

A monopolist sells its product in two isolated markets with demand functions

            P1 = 32 − Q1 and P2 = 40 − 2Q2

The total cost function is TC = 4(Q1 + Q2).

(a) Show that the profit function is given by

       π = 28Q1 + 36Q2 − Q12 − 2Q22

(b) Find the values of Q1 and Q2 which maximise profit and calculate the value of the

maximum profit. Verify that the second-order conditions for a maximum are satisfied

Anne would produce 10 robots a week working for an employer that recently offered her a position. Each robot requires $50 in material inputs and sells for $100. For Anne, this would mean no longer day trading, from which she makes $450 per week. Which of the following wage rates might Anne and the robot factory agree to?

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If c=R20 billion, I=R30 billion, g=R25 billion, x=R15 billion, z=R12 billion, c=0,75 the value of the multiplier is?

Income of a person is 8000 and he uses 60 units of a commodity. Calculate income elasticity of       demand when the income increased by 30% and consumption of the good is decline by 50%

if on the production possibility curve show that the particular country is producing a large amount of tertiary goods than the manufactured good, how do we describe them in terns of;

-type of economy

-utilization of resources

-common type of business activity would expect to find in this economy

-distribution of national income(wealth) and

-techniques of production

how do we interpret the profit maximizing point using the graph

Describe the nature of the goods produced by a monopolistically competitive firm. (10 MARKS)

Describe and give some explanations about 2 factors that would cause most companies' labor demand to move, as well as how this would influence equilibrium wages and the value of labor's marginal product.

Suppose LA.Banana employs workers to harvest bananas. Answer the following questions using the information provided below:

Quantity of labour:

1. 0 labour
2. 1 labour
3. 2 labour
4. 3 labour
5. 4 labour
6. 5 labour
7. 6 labour

Units of Output:

1. 0 banana
2. 16 banana
3. 21 banana
4. 25 banana
5. 31 banana
6. 36 banana
7. 40 banana

a.) Calculate the marginal product of labor, the value of the marginal product of labor, and the marginal profit ,suppose a fully competitive company, LA"Banana, where wages are fixed at $800 and each banana (output) sells for $20. Explain how many labors the company should and should not demand based on your answer.

b. ) Describe and give some explanations about 2 factors that would cause most companies' labor demand to move, as well as how this would influence equilibrium wages and the value of labor's marginal product.