Microeconomics Answers

, Malaysia, along with six other Asian and Middle Eastern countries
(China, Iran, Saudi Arabia, Vietnam, Singapore, and Indonesia). In contrast to the countries mentioned above, for example, 11 out of 50 states in the United
States of America have legalized the use of recreational and medicinal cannabis (weed).
Discuss the pros and cons of legalizing drugs such as cannabis from an economic perspective
using the concepts of supply, demand, and elasticity.

Describe the elasticity of supply for micro-credentials. What effect does this have on price and
quantity as demand for the micro-credentials increase? What about its effect on university
education?

“There is a high cross elasticity of demand between new and old cars”. Discuss the statement by explaining the features of cross elasticity of demand . Also compare and contrast cross elasticity with other types of elasticities of demand

A Business Firms sells a good at the price of rs 450. The firm has decided to reduce the price of good to rs 350. Consequently , the quantity demanded for the good rose from 25,000 units to 35,000 units. Calculate the price elasticity of demand

Assume a country produces haircuts and shirts with inputs of labour. The country has 1000 hours of labour available. A haircut requires ½ hour of labour, while a shirt requires 5 hours of labour.
a. Construct country’s production- possibility frontier. (2 marks)
b. The country is faced with massive unemployment. How will the PPF be impacted? Explain and indicate on graph. ( 1 mark)
c. The country discovers new technology and moves towards automation. Justify how this will impact the PPF for the economy. Also, indicate the same through the graph. (1mark)

In the context of Pakistan’s society for each of the following products, indicate the correct type of price elasticity of demand or supply and also justify your answer:
a) An exquisite painting to be sold at an auction (1 Mark)
b) Demand for Cancer-treating drug (1mark)
c) Production of gold mining (1 mark)
d) Demand for gold (1 mark)

The cost of the next best alternative forgone is known as

in past 50 years the frozen food industry in U.S has grown from $1billion to $27 billion. Discuss the role of opportunity cost in our lives with regards to this huge growth in the frozen food market in the U.S

You deposit a $1,000 scholarship check in the bank. If the required reserve ratio is 10 percent, explain how the banking system will create new money and how much money can potentially be created.