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v> Combination Tablet (units) Coffee (units)
A 0 10,000
B 100 9,000
C 200 7,500
D 300 5,500
E 400 0
B) Explain how the opportunity cost changes when the production of tablets is increased
progressively from 0 units to 400 units. Give a reason for the changes in opportunity cost
observed.
(4 marks)
C) If a national lockdown reduces the supply of workers in both the tablet and coffee
markets, use a diagram to show how the production possibility curve of the economy
changes. Explain your answer briefly.
(4 marks)
D) If an improvement in technology is seen in the production of coffee, use a diagram to
show how the production possibility curve of the economy changes. Explain your answer
briefly (4 marks)
Suppose a firm finds that the marginal product of capital is 60 and the marginal product of labor is 20. If the price of capital is $6 and the price of labor is $2.50, describe how the firm should adjust its mix of capital and labor? What will be the result?
jackfruits. If this information about the cyclone is available for all so that all buyers and sellers in
the jackfruit market expect the price of jackfruits to rise in the future, what will happen immediately
to the supply and demand for jackfruits and the equilibrium price and quantity of jackfruits? Explain
your answer with the help of demand and supply diagram. (6)
the market for pizza has the following demand and supply schedules:
price: $8,$9,$10,$11,$12,$13
quantity demanded: 135,104,85,68,53,39
quantity supplied: 26,53,85,98,110,121
a.graph the demand and supply curves. what are the equilibrium price and quantity in this market?
b.if the actual price in this market were above the equilibrium price, what would drive the market toward the equilibrium?
c.if the actual price in this market were below the equilibrium price, what would drive the market toward the equilibrium?
a company is considering building a bridge across a river. the bridge would cost $1.5 million to build and nothing to maintain. the following table shows the company's anticipated demand over the lifetime of the bridge:
price per cross: $8,$7,$6,$5,$4,$3,$2,$1,$0
number of crossing in thousand: 0,100,200,300,400,500,600,700,800
a.if the company were to build the bridge, what would be its profit-maximizing price? would that be the efficient level of output? why or why not?
b.if the company is interested in maximizing profit, should it build the bridge? what would be its profit or loss?
c.if the government were to build the bridge, what price should it charge?
d.should be government build the bridge? explain
If the multiplier is 4, a R40 billion increase in net exports will?
shops. Explain THREE (3) characteristics of market structure for coffee shops. Illustrate and
explain ONE (1) type of short run profits for barbershops due to the extension of national
lockdown. Illustrate and explain TWO (2) decisions when the barbershops should consider
to closed down their business. Elaborate your answer with examples and diagrams.
A perfectly competitive firm is in equilibrium where marginal cost is equal to marginal revenue because:
How do you know whether your estimated model is a good one or not? Explain.
1. Consider the following model relating fertility (Y), as measured by the number of children born, to education (X),
(i) What kind of factors are contained in the error term? Are these factors likely to be correlated with the level of education?
(ii) Will a simple linear regression analysis produce an unbiased estimate of the effect of education on fertility? Explain.
