Microeconomics Answers

Derive the returns to scale associated with the following production functions
when both inputs, K and L, are increased by t times and t > 1.
a) Q = min( αL, βK), α, β > 0
b) Q = L ^2/3 K ^2/3

Need help in all, thank you!

A firm has production function f(z) = 2z
1/2 The price of the input is r and the price of
output is p.
a) Calculate the optimal output, input, and profit?

Q 2 Using demand and supply diagram, explain each of the following cases:
a) Rains affected the onion storage in Maharashtra, Madhya Pradesh, Gujarat and other states, driving up the wholesale prices. On Sept 14, the central government announced ban on export of onions. Import norms have been relaxed to allow entry from Iran, turkey and other onion-producing nations.
c) During covid19 many farmers in UK threw thousands of litres of milk away.

Suppose the demand equation for computers by Teetan Ltd for the year 2017 is given by Qd= 1200-P and the supply equation is given by Qs= 120+3P. Find equilibrium price and analyse what would be the excess demand or supply if price changes to Rs 400 and Rs 120

Imagine that there are currently 10,000 students enrolled at your institution. The school decides to increase tuition, and enrollment falls to 9,000. Tuition started at $4,000 per semester but has since gone up to $4,800. What is the elasticity of demand?

Market demand P = 820 – 2Q is supplied by a Stackelberg leader and a follower both of whom have marginal costs of $20 per unit. How much output will the leader produce?

What is a market demand curve

From the list below, which of the following do you expect to suffer from a free-rider problem? Check all that apply.

a. Pay-what-you-can yoga classes.

b. Unlimited yoga classes with monthly membership dues.

c. Fundraiser for public television.

d. Neighborhood park cleanup day.

e. Housecleaning business operating in your neighborhood.

f. Suggested museum-admission donation.

C = 450 + 0.4Y
I = 350

G = 150
X = 70
Z = 35 + 0.1Y
T = 0.15Y
Yf = 1550



Q.2.4 Calculate the tax revenue to the government of this country when the economy
remains in equilibrium.
(2)

Explain what is meant by consumer and producer
surplus. How and why is total surplus maximised in a competitive market equilibrium?