Microeconomics Answers

Each firm is producing 150 units of output in which it sells at a price of R20 per unit; out of this amount each firm is paying R4 tax per unit of the output,the government decide to abolish tax . Explain what would happen in the short run of the equilibrium price and industry output;number of firms , illustrate on a diagram for number of the market and number firms

How will the Eskom intervention of covering up for all the debts and coal shortages impact on consumers

Name and define in detail the type of market structure Eskom is operating as?

How will Eskom’s interventions of covering up for all the debts and coal shortages impact on
consumers?

The data below show real wage levels at various percentiles of the wage distribution for material-handling labourers in New Zealand.

Percentile 1975 1995

10th $4.26 $2.97

50th $6.02 $3.89

90th $10.44 $9.07

A. Calculate w90/w50, w50/w10, and w90/w10 percentile wage differentials for both years.

B. Describe the changes in wage inequality in this local market

C. Use the relative demand and supply model to explain the effect of increased immigrants into this labour market on relative wage and employment outcomes

A. How can both the union and firm be better off by bargaining over the wage rate and employment rather than just the wage rate? Explain with the help of the efficient contract model.

B. If we assume that a union’s utility only depend on the wage rate and not the level of employment, what will be the outcome under the efficient contracts model.

Tom is a full-time lecturer at a private higher education institution and is considering a career in
carpentry. He wishes to pursue a career in carpentry (a childhood dream) which he has studied part-time
and is now equipped to take on clients. In his current position he earns a rate of R1000 per day and if he
were to pursue a career in carpentry he would earn R800 per day. Due to the flexibility of the
employment conditions at the higher education institution he works for, Tom can negotiate the number of
days he works at and will receive a rate of remuneration based on the number of days worked.
Question 1
1.1 Construct a production possibility frontier to illustrate Tom’s earnings potential between the two
careers if initially he was not working as a carpenter, then he worked one week per month, then two,
then three and finally four weeks per month (assuming only four weeks in a month).

With regard to coal shortages and municipal debts, what form of intervention do you think can Eskom can put in order to cover up all debts and continue operating? Incorporate relevant graphs in your answer

When the price of commodity c rises by 10%,the quantity demanded falls by 18%.this is an example of

With regard to coal shortages and municipal debts. What forms of intervention do you think Eskom can put in place in order to cover up all the debts and continue operating? incorporate relevant graph's in your answer