Economics Answers

A. The following is a macroeconomic model of Utopia. The Utopian currency is the Utopian dollar (#).
Y = C + I + G + NX (National Income Identity)
C = C0 + cYd
(Consumption Function)
I = I0 (Investment Function)
G = G0 (Government Expenditure Function)
X = 20 (Export Expenditure)
M = 35 (Import Expenditure)
Y
d
= Y – T (Disposable Income)
Required:
i. Compute the value of the balance of payments (BOP). (1 mark)
ii. State the BOP position. (1 mark)
iii. Explain the BOP position you found in (ii) (1 mark)
iv. State and explain one (1) strategy for the Utopian government to improve the BOP position. (2 marks)

discuss oligopoly behavior in detail with reference to collusion and the role that the south african competition act 89 of 1998?

q=500-0.5p and AC=q^2-59q+1315+200/q find the level of output and price at which profit will be maximized. find MC x=5 and interpret

b) Continue to assume that x = 5/4, but the market for long-distance telephone service remains perfectly competitive following the merger. For what values of s will the DOJ approve this merger? (15)

Assume that two identical firms in a purely oligopolistic industry selling a homogenous product agree to share the maket equally. The total market demand function for the commodity is Qd = 240 – 10P. The cost schedules of the firms are given in the following table: q1 40 50 60 80 q2 50 70 100 SMC1 (Rs.) 8 10 12 16 SMC1 (Rs.) 4 6 9 SAC1 (Rs.) 13 12.3 12 13 SAC1 (Rs.) 7 6 7
Q1.- When q2 = 100, then MR2 will be
Select one:
a. 16
b. 32
c. -32
d. -16
Q.2 When q2 = 50, price at this level of output will be
Select one:
a. 12
b. 14
c. 24
d. 32
Q3 When q2 = 50, then MR2 will be
Select one:
a. 2
b. 4
c. 5
d. 6
Q4When q2 = 70, then MR2 will be
a. 4
b. -9
c. -4
d. -5

Work Out Question
1. The demand for petrol rises from 500 to 600 Barrels when the price of a particular scooter is reduced from Birr. 25000 to Birr.22000. Find out the cross elasticity of demand for the two. What is the nature of their relationship?
A company has the following demand equation
Q= 1000–3000P+10A
Q = Quantity demanded
P = Product Price
A = Advertisement expenditure
Assume that P = 3 and A = 2000
2. Suppose the firm drops the price to Birr. 2.50 would this be beneficial.
3. Suppose the firm raises the price to Birr. 4.00 While increasing its advertisement expenditure by 100 would this be beneficial? Explain

Given a short run cost function as T C =1 /Q 3 (3 is under subscript ) - 2Q 2(2 is under subscript ) +60Q+100 , find the minimum value of AVC and MC

a) Determine the total fixed cost for producing 100 and 300 units of output, respectively.

b) What is Average fixed cost for 100 and 300 units of output?

Consider the following information for a particular economy.
Total population =60 million
Number of employed=30 million
Total labor force = 40 million
Natural rate of unemployment =12%
a) Find the total unemployment rate
b) Calculate the cyclical unemployment rate

A small restaurant can produce the following “take-away” meals in any one day. The restaurant plans to make 2 lasagne and 12 pizzas today. [2]
Option Lasagne Pizzas
1 0 15
2 1 14
3 2 12
4 3 9
5 4 5
6 5 0
Orders for two more lasagne come in. What is the opportunity cost of producing the additional two lasagne?

a cycle manufacturer produces X cycles per week at a cost of x2/25+3x+100. He is a monopolist and the demand for his market is x=75-3p where p is the price in rupees per cycle. Show thay the maximum net revenue is obtained when about 30 cycles are produced per week. what is the monopoly price