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A monopolist faces demand with constant elasticity of -2. Marginal cost is $20. Find profit maximizing price for this monopolist.
. The Three Amigo’s company produced and sold 500 dog beds. The average cost of production per
dog bed was $50. Each dog be sold for a price of $65. The Three Amigo’s total costs are
a. $7,500
b. $25,000.
c. $32,500.
d. $67,500.
In 2005 Earthquake has devastating effects on the economy. A lot of factories gets
destroyed, many people lost their life. Explain with the help of demand and supply
curves how an earthquake affects the market equilibrium and what is the new
equilibrium price and quantity.
In 2005 Earthquake has devastating effects on the economy. A lot of factories gets
destroyed, many people lost their life. Explain with the help of demand and supply
curves how an earthquake affects the market equilibrium and what is the new
equilibrium price and quantity.
Problem No. 2
From following date compute (i) Real GDP (ii) GDP deflator (iii) inflation rate
Year
Nominal GDP
Rs. billion
CPI
2018-19
54195
228.1
2020-21
61583
251.3
Explain the issue raised in the article concerning Eskom’s debt, detailing the relevant theories and the impact to the South African economy and consumers. Discuss the impact of Eskom’s debt on the company, consumers, energy dependent producers and the South African economy
The market demand for a type of carpet has been estimated as: P = 40 -
0.25Q, where P is price (GHØ/yard) and Q is rate of sales (hundreds of yards per month). The market supply is expressed as: P = 5.0 + 0.05Q. A typical firm in this market has a total cost function given as: C = 100 - 20.0q + 2.0q2.
Determine the equilibrium market output rate and price.
Determine the output rate for a typical firm.
Determine the rate of profit (or loss) earned by the typical firm
Selling T-shirts is easy. Consumers spend at least $15 billion a year on them. Moreover, the inventory is easy to store, doesn’t spoil, and is compact. On the surface, a great business.
But there’s a catch—everybody and his brother sells T-shirts. Every beach resort has dozens of T-shirt shops. And they sprout like weeds at every major sporting or concert venue. And then there are all the online sites that offer custom designs and quick delivery. So, the competition is intense. This makes it near impossible for any T-shirt shop to raise the price of its T-shirts, much less hold on to profits. The owner of a T-shirt shop in South Padre Island, Texas, lamented, “Every day you have to compete with other shops. And if you invent something new, they will copy you.”
Questions:
1.What determine the ability to make profit on this market of T-Shirts?
2.Why is so difficult to maintain profit?
Please give detailed answers with different other examples of the competitive markets.
Assume that in the market for tulips, there are hundreds of buyers and sellers of tulips, all of the tulips are identical, and it is extremely easy for anyone to become a tulip farmer and sell tulips. This market would most likely be characterized as a
market.
6. Find the demanded bundle for a consumer whose utility function is. u( x y) = x3/2 y and her budget constraint is 3x+4=100.
7. The demand function for a particular good is x = a + bp. What are the associated direct and indirect utility functions?
8. The demand function for a particular good is x = a+ bp+ cm.What are the associated direct and indirect utility functions?
9. Explain how the downward sloping demand curve can be derived using indifference curves and budget lines. Using the same technique, show that it is theoretically possible to have an upward sloping demand curve.
