Economics Answers

Suppose a friend of yours asks you about Islamic banking and he does not believe in Islamic banking because Islamic banks use KIBOR in taking profit which is the benchmark of conventional banks and moreover Islamic Banks also receive extra money from thier customer in case of delay of his payment. So how do you satisfy your friend by answering these questions?

Five customers deposit Rs. 5, 10, 15, 20 and 25 lakh in a fixed account with Islamic Bank respectively. The first three customers plan to deposit for seven years while the last two customers plan to deposit for five years. Since the fixed account is based on Mudaraba agreement, the Islamic Bank and they agreed on profit rate of 50:50 percent.
Suppose Islamic Bank earns a monthly profit of Rs. 50 lakhs by using this deposited money.

Required:
After giving a reasonable weightages to all customers, calculate the monthly profit rate of each customer.

Explain how the value of marginal cost affects the values of average variable cost and average total cost and what this means for the relationship between the marginal cost curve and the average variable and total cost curves. Draw & explain it in detail.

At its best possible output level, a firm has total revenue of Rs. 7000 per day and total cost of Rs. 14000 per day. What should this firm do in the short run if: 05
(Hint: See normal and abnormal loss)
i) The firm has total fixed cost of Rs. 6000 per day?
ii) The firm has total variable cost of Rs. 6000 per day?

Using the World Bank’s World Development Indicators database, https://databank.worldbank.org/home.aspx, a) Complete the following table. 2005 2010 2015 2018 GDP per capita (current) Australia China India U.S. GDP growth rate Australia China India U.S. Inflation rate Australia China India U.S. b) Produce a plot for each variable (GDP, gdp growth, inflation) comparing the four countries.
c) What can be inferred with respect to economic growth and price control in each of these country

A news piece regarding Sugar inquiry commission report is available at the following link.
https://dunyanews.tv/en/Pakistan/546488-Govt-makes-Sugar-inquiry-commission-report-public
Read the report carefully. With the help of graph, analyze the possible consequences of setting price floor of sugarcane below equilibrium price. Compare your conclusions with the ones, stated in this report.

analyze the possible consequences of setting price floor of sugarcane below equilibrium price. Compare your conclusions with the ones, stated in this report.

Using the World Bank’s World Development Indicators database, https://databank.worldbank.org/home.aspx, a) Complete the following table. 2005 2010 2015 2018 GDP per capita (current) Australia China India U.S. GDP growth rate Australia China India U.S. Inflation rate Australia China India U.S. b) Produce a plot for each variable (GDP, gdp growth, inflation) comparing the four countries.
c) What can be inferred with respect to economic growth and price control in each of these country

analyze the possible consequences of setting price floor of sugarcane below equilibrium price. Compare your conclusions with the ones

A firm manufactures quad bikes. Each quad is made using 1 frame (x1) & 4 wheels (x2). Each frame costs 10£ and each wheel costs 4£. The output of the firm can therefore be represented by the function: min [x1, 1/4 x2]
1) what is an isoquant? Show the isoquant for producing 2 quads? 3 quads and 7 quads.
2) define the firms cost function and derive it. Assume that each wheel costs 4£ and each frame costs 10£. What is the cost of producing 7 quads?
3) derive the input demands for frame and wheels for the firm. How do they depend on input prices? What is the maximum number of quads the firm can produce if the number of wheels is fixed at 12? Assume that the firm is producing the maximum number of quads. What is the marginal product of adding an extra frame?