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The marginal revenue of a product is sh 300 and we know that total revenue is zero when x is zero the marginal cost is sh 200 and we are given that when x is zero the total cost equals to ksh.120,000
For supply to respond to an increase in demand the supplier must be aware that demand has indeed increased, however supply may not respond immediately to the change in demand”, Describe the factors that may attribute to this situation.
WOU Records decides to release an album by the group Cat and the Kittens. It produces the album with no fixed cost, but the total cost of downloading an album to a CD and paying Mary her royalty is RM6 per album. WOU Records can act as a single-price monopolist. Its marketing division finds that the demand schedule for the album is as shown in the accompanying table.
Price of album (RM) Quantity of album demanded
22 0
20 1000
18 2000
16 3000
14 4000
12 5000
10 6000
8 7000
(a) Calculate the total revenue and the marginal revenue per album.
[10 marks]
(b) The marginal cost of producing each album is constant at RM6. To maximize profit, determine the level of output and price it should charge for each album.
[15 marks]
(c) Cat renegotiates her contract and now demands a higher royalty per album. The marginal cost rises to be constant at RM14. To maximize profit, determine the level of output and price it should charge for each album.
[15 marks]
Given below are the demand and supply functions for three interdependent commodities.
Qd1 = 110 – 4P1 + 3P2 – 4P3 ; Qs1 = 2P1 – 20
Qd2 = 46 + 2P1 – 4P2 + 4P3 ; Qs2 = –14 + 2P2
Qd3 = 20 – P1 + 4P2 – 2P3 ; Qs3 = 2P3 – 10
Determine the equilibrium prices and quantities for the three commodity Market model. Then compute the
price and cross elasticities of demand for the third market and interpret their coefficients.
Assuming that the given demand function Qd = 700 − 2P − PR + 0.1M, represents the demand for Good-X where P is the price of Good-X, PR is the price of related product, while M is average consumer income.
a.What happens to the demand for Good-X when the price of related product goes up? What are the Good-X and the related product?
b.What happens to the demand for Good-X when average consumer income rises?
1 What is the difference Between Want and Demand? Explain it with the help of example
what is the effect on the market price and output of hamburgers with reference to the following
a)widespread of beef
b)dramatic improvement in fast food technology
what is the effect on the market price and output of hamburgers with reference to an increase in the income of consumers
A firm faces the production function below and can buy L at Php240 a unit and K at Php4 a unit.
A. If it has a budget of Php 16,000 what combination of K and L should it use to maximize output?
Q = 2K 0.2 L 0.6
The market demand curve for microwaves is Q = 260 - 3P.
The market supply curve for microwaves is Q = 20 + P.
The equilibrium price of a microwave is 60 (Enter only a number. Do NOT enter any symbols.)
The equilibrium quantity of microwaves is 80 (Enter only a number. Do NOT enter any symbols.)
Suppose the government gives firms a $20 subsidy for every microwave sold. After the subsidy is imposed:
The price consumers pay for a microwave after each microwave is subsidized is (Enter only a number. Do NOT enter any symbols.)
The price firms receive for a microwave after each microwave is subsidized is (Enter only a number. Do NOT enter any symbols.)
The quantity of microwaves exchanged in the market after each microwave is subsidized is (Enter only a number. Do NOT enter any symbols.)
