Economics Answers

Judge the effects of advertising in shifting the demand curve. Whether adverts are persuasive or informative is a matter of psychological judgement: whether advertising shifts the demand curve is a matter of empirical observation. The determination of an optimal advertising budget requires a comparison of the costs and benefits of advertising that may proceed in various forms, from marginalism through the Dorfman-Steiner theorem to an informational approach.

Why is scarcity the central feature of the economic problem?

A person has $ 100 to spend on two goods X and Y whose respective prices are $3
and $5. A. Draw the budget line. B. What happens to the original budget line if the
budget falls by 25%? C. What happens to the original budget line if the price of X
doubles? D. What happens to the original budget line if the price of Y falls to $4?

If a plane has few empty seats before taking off, should airlines sell it below average cost?
Provide a suitable justification

. Discuss the effect of covid-19 on the level of unemployment

Use a graph to demonstrate the circumstances that would prevail in a competitive market where firms are earning economic profits. At its current level of production a profit-maximizing firm in a competitive market receives price of $12.50 per unit, and faces an average total cost of $10. At the market price of $12.50 per unit, the firm's marginal cost curve crosses the marginal revenue curve at an output level of 1000 units. What is the firm's current profit? Can this profit be maintained in the long run? Carefully explain your answer.

What is real GDP

What are the key spending programs driving the impending crisis in government sovereign debt?

2. In what ways are the effects of the regulatory delay tax discussed in the chapter more burdensome than an ordinary tax?

9. Ato Bekele is producing various biscuits in his Company in three factories residing in different parts of Ethiopia. Its line of biscuits exhibits a highly seasonal demand pattern, with peaks during the month of September & October and declines through the months November & December. Given the following costs and monthly sales forecasts, determine whether;
(a) Level production, or (b) chase demand would more economically meet the demand for biscuits:
Months Sales forecast
September 40,000
October 25,000
November 60,000
December 75,000
Hiring costs-------------------------------------------------$ 100 per worker
Firing cost---------------------------------------------------$ 500 per worker
Inventory carrying cost------------------------------------$ 0.5 Cents per biscuits per biscuits
Regular production cost per biscuit----------------------$ 2
Production per employee-------------------------------- 1000 biscuits per month
Beginning work force-------------------------------------100 workers