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Discuss the impact the hard lockdown had on perfect market
Given the demand for a product as Qd = 100 - 5P and the supply is given as Qs = -20 + 3p. You are told equilibrium is obtained at the point where Qd = Qs. The equilibrium quantity for the product is
difference between monopoly and perfect competion for 10 marks
You are planning to start a business. When calculating the costs. You have considered the costs of setting up your manufacturing plant, production, logistics, and all other costs except for the opportunity cost of your initial investment in this business. Which of the below is true?
A) You calculated the economic cost.
B) You calculated the explict costs.
C) You calculated only the variable costs.
D) You calculated only the fixed costs.
Analyse constraints faced by new firms in the economy
Mustansir is the owner of small pottery firm. He has hired one helper at Rs. 15,500/= per month,
pays annual rent of 144,000/=, spends around 19,000/= on materials. He has 400,000/= of his own
funds invested in equipment like pottery wheels, kilns and so forth that could lead him to earn
50,000 per year if alternatively, invested. He was also offered by his competitor to work as a potter
and earn 60,000/= per month. He estimated his entrepreneurial skills worth Rs. 53,000 per year.
Although total annual revenue from the pottery sales is 9,650,000. Calculate the accounting and
economic profit of Mustansir’s pottery firm and comment on the situation that whether he should
continue doing the business or shut down.
Assume a monopolistic publisher agreed to pay an author 10% of the total revenue from the sale of
the text. Will the author and the publisher want to charge the same price for the text? Explain in
the light of price discrimination?
an increase in supply...
“If education is provided free of charge to (some or all) students, someone else has to foot the bill.
In most cases, this would be the government and thus, by implication, the taxpayer. In the
2018/2019 budget of the South African government, the additional allocation to subsidise higher
education and training fully for poor and working-class students amounted to R12.4 billion. In 2019
and 2020, it is estimated it will amount to R20.3 billion and R24.3 billion, respectively.”
(4 marks)
Assuming that education and healthcare are the only expenditure items on the governments budget (and are
represented by a production possibilities curve), the increase of the above above subsidy represents…
a) A movement along the production possibilities frontier.
b) A movement towards the production possibilities frontier
c) An outward movement of the production possibilities frontier
d) An inward movement of the production possibilities frontier
small farmer is more likely to operate in a perfectly competitive market than a company like AB inBev because...
a) a small business is more likely to keep close control on costs than a large firm.
b) AB inBev employs many people, whereas perfectly competitive firms are owner-managed.
c) the demand for beer is less elastic than the demand for food.
d) a small farmer supplies a small share of market supply.
