Microeconomics Answers

. Yamoah has an income (M) ofGH¢200 to spend on two commodities Maize and Yam. 

Maize costs GH¢ 1.20 per unit and Yam costs GH¢ 1.1 0 per unit. 

(a) 

Write down Mrs. Yamoah's budget equation. 

(b) 

Write down Mrs. Yamoah's budget line. 

(c) 

What is Mrs. Yamoah's Marginal Rate of Substitution of Maize to Yam? 

Suppose the demand and supply for good x are functions p=6.25-1/8Qd and p=1.75+1/10Qs what is the equilibrium price and quantity

cigarettes are forbidden, so people trade cigarettes in a black market. The 

cigarette demand is 𝑄𝐷 = 12 − 𝑝, and cigarette supply is 𝑄𝑆 = 2𝑝.

A store that sells rice discovers that when the price of 1kg rice Is R24 per kilogram, the quantity demanded is 306 kgs per week. When the price decreases to R21 per kg, then the sales increase to 340 kgs per week. Use this information to answer questions 1 and 2 below.

1-Determine the price elasticity of rice using the Arc method.

.2Discussthe relationship between the price elasticity of rice and the total revenue the store received from the sales. Advise the store on an appropriate pricing strategy.

Explain using the demand and supply analysis, the impact on the market for the cars as more people come to our country and at the same time the cost of the steel needed to make the cars decreases. Clearly state the effect on demand and supply and whether equilibrium price and/or quantity have increased, decreased or whether the outcome is uncertain.

A market consists of a single product Apple and two individuals A,B and C. A's demand for apple is given by Q=(16-4P), that of B's is Q =(20-2P) and that of C's is Q=(12-2P). If the market supply equation is Q=4P, then the equilibrium price and equilibrium quantity are?

A manager believes that the supply for his product is given by the equation P= 50+(Q/100).The arc elasticity of supply as price increases from Rs 10000 to Rs 20000 is closet to

John was consuming 100 balls of Cake (X) and 50 pieces of Fish (Y) per month. The price of Cake rose from GHS 2 to GHS 3. The price of Fish remained the same at GHS 4. How much would John’s income (M) have to rise so that he can still exactly afford 100 cakes and 50 fish?

What would we expect to happen to the market when the government imposes a price floor below equilibrium

Q3) From the specific supply function 𝑄𝑠𝑥 = 2𝑃𝑥 (Px is given in dollars), derive;

(a) the producer’s supply schedule and

(b) the producer’s supply curve?