Economics Answers

what is the difrence b/n macro and maicro

In recent years the price of crude oil on the world market has fallen dramatically. One cause has been the increase in oil obtained by the new extraction process of fracking. How is this shown on a demand and supply diagram of the market for crude oil? *
1 point
A a shift in the demand curve to the left
B a shift in the demand curve to the right
C a shift in the supply curve to the left
D a shift in the supply curve to the right

Which is an internal diseconomy of scale? *

A a lack of communication in a firm
B a reduction of cost by buying in bulk
C a shortage of skilled labour in an area
D traffic congestion in a particular area

The accompanying table gives part of the supply schedule for personal computers in the United States.

Price of computer

Quantity of computers supplied

$1,100

12,000

$900

8,000



a. Calculate the price elasticity of supply when the price increases from $900 to $1,100 using the

midpoint method.

b. Suppose firms produce 1,000 more computers at any given price due to improved technology. As

price increases from $900 to $1,100, is the price elasticity of supply now greater than, less than, or the

same as it was in part a?

c. Suppose a longer time period under consideration means that the quantity supplied at any given

price is 20% higher than the figures given in the table. As price increases from $900 to $1,100, is the

price elasticity of supply now greater than, less than, or the same as it was in part a?

a) For a given year, of all adult residents, 268,447,000 were employed, 7,000,000 were unemployed, and 71,713,000 were not in the labour force. Calculate the labour force and unemployment rate. (3 marks)
b) If the unemployment rate is smaller than the natural rate of unemployment, what will the cyclical rate of unemployment be? Briefly explain. (3 marks)
c) State whether the natural rate of unemployment increases or decreases in the following scenarios. Specify whether it is a change of frictional unemployment or structural unemployment. (4 marks)
i) The development of 5G technology is expected to cause more frequent sectoral shifts.
ii) The government increases the unemployment insurance benefits.

Computer Garage sells iPad for cash sh at 80,0000 inclusive of one year unlimited International warranty of any manufacturers defects. The management is concerned about the rising cost of warranty and have recommended provisions to be created with effect from 2014.Estimates from the sale department indicates the following.
Defect type minor ,major and replacement.
Percentage of units sold 2% ,0.5% ,0.1% .
Estimated cost per unit 2300, 6000 and 18600 .
Summary of cashbook and warranty contains the following
Year ended 31st March 2014 ,31st March 2015 ,31 st March 2016.
Warranties paid (ksh) 654,000 ,450,900, 346 200.
Warranty contracts in force ( units) 15,000 ,24,800 ,18,400 .
Required.
Compute the warranty provisions required at each year.
Prepare the provisions for product warranty account.

1. Assume a firm’s total cost function is:- TC=12+60Q-15Q2+Q3
Required: Suppose that the firm produces 20 units of output. Calculate
Total fixed cost (TFC),
Total variable cost (TVC),
Average total cost (ATC),
Average fixed cost (AFC),
Average variable cost (AVC), and
Marginal cost (MC).

When estimating a demand function, explain why fitting a line of best fit through observed price and quantity combinations over time is not likely to yield good estimates.

The demand function of a good is given by the expression Q³-8Q²+20Q+2
I) Find the level of output, which maximizes total revenue
II) Find the maximum profit

Table 1. Return on Assets

Asset GBP

Budgeted profits for the year 10,575,000

Asset base at the start of the year 58,925,000

Budgeted asset base at the end of the year 69,500,000

Average asset base 64,212,500

ROA (using average of opening and closing assets) 16.5%


Calculate the budgeted ROA for sales outputs of 4,200,000 and 4,500,000 units. Assume that any additional profits over the original budget will be invested in the business and therefore increase the budgeted closing asset base.