Economics Answers

8. The design capacity for Bakery Company is 1000 loafs of bread per day. The effective capacity is 800 loafs of bread per day and the actual output is 650 loafs of bread per day. The company goal is to produce 950 loafs of bread per day. Calculate the utilization and efficiency of the operation. If the efficiency for next month is expected to be 85%, what is the expected output?

1. Suppose that a monopolist firm has the following information
Q= 50-0.1P
TC= 25+10Q+0.5Q2
P=250- 2.5Q
A. Find the profit maximizing output (5 points)
B. Find the profit maximizing price (5points)
2. Assume that a project requires an initial investment of Br. 60,000 and the rate of return is 10%. The after taxes cash flows (or net cash flows) are as follows: (5 marks)
Year 1 = 8000 Year 4 = 20,000
Year 2 = 15,000 Year 5 = 20,000
Year 3 = 22,000
A. Calculate the payback period (PBP)
B. Calculate the Net present value (NPV)

Which combination of goods will Joe buy in order to maximise his utility?
A. 2unitsofA,2unitsofBand2unitsofC. B. 0unitsofA,5unitsofBand6unitsofC. C. 7unitsofA,7unitsofBand0unitsofC. D. 4unitsofA,3unitsofBand4unitsofC. E. 6unitsofA,3unitsofBand3unitsofC.

Using supply and demand analysis, explain the effects on equilibrium price and quantity of the following events on the market for shipping 1 a decrease in freight carried by ship 2. A rise in the real wages paid to ship construction workers 4. A government subsidy for ship production

The following data relates to the market value of economic transactions for the three main sectors of our country's economy.

Sector Value of output Purchases from other Firms
Agriculture 300 160
Manufacturing 200 150
Services 150 120
i. Compute the gross domestic producdt (GDP)
ii. Compute Gross national (GNP) at market prices
iii. Compute Net national Product (NNP) at Market Prices.
iv. Compute Net National Product (NNP) at factor cost.
v. Net domestic product (NDP) at factor cost.

Assume that the market for rental cars for business purposes is perfectly competitive, with the demand for this capital input given by K=1500-25v, and the supply is given by K= 74v-500 where K represents the number of cars rented by firms and v is the rental rate per day. What will be the equilibrium levels for v and K in this market?

A monopolist faces two totally separated markets with inverse demand p=100 – qA and p=160−2qB respectively. The monopolist has no fixed costs and a marginal cost given by mc= 2 /3 q Find the profit maximizing total output and how much of it that is sold on market A and market B respectively if the monopoly uses third degree price discrimination.
a) What prices will our monopolist charge in the two separate markets?

A monopolist faces two totally separated markets with inverse demand p=100 – qA and
p=160−2qB respectively. The monopolist has no fixed costs and a marginal cost given by mc= 2 /3
q Find the profit maximizing total output and how much of it that is sold on market A and market
B respectively if the monopoly uses third degree price discrimination.
a) What prices will our monopolist charge in the two separate markets? (6 m)
b) Calculate the price elasticity of demand in each market and explain the intuition behind the
relationship between the prices and elasticities in these two separate markets. (4 m)

How is the interest for notes receivable calculated? if tropical breeze inc. receives a 2000$ , 90 day, 10% promissory from paradise sand on december 1,2018. Calculate 30 days of interest received by tropical breeze inc

Que 1. Sameer Electronics is producing a large range of electrical goods. It has under construction two projects ‘X’ and ‘Y’ each costing Rs. 120 lakhs.
The projects are mutually exclusive and the company is considering the question of selecting one of the two. Cash flows have been worked out for both the projects and details are given below. X has a life of 8 years and Y has a life of 6 years. Both will have zero salvage value at the end of their operational lives. The company is already making profits and its tax rate is 50%. The cost of capital of the company is 15%.
Net cash inflow (Rs. in lakhs)
Year 1 2 3 4 5 6 7 8
Project X 25 35 45 65 65 55 35 15
Project Y 40 60 80 50 30 20 - -
PV @ 15% 0.870 0.756 0.685 0.572 0.497 0.432 0.376 0.327
The company follows straight line method of depreciation. Advise the company regarding the selection of the project.