Economics Answers

What is equilibrium? Suppose, demand function for Singara is QD = 50 – 2P and supply
function is QS= 20 + 3P. Find out -
(i) The equilibrium price and quantity of Singara.
(ii) If the supply increases to QS = 30+3P, what will happen to the equilibrium
price and quantity?
(iii) If government imposes a price ceiling at Tk. 3, what will happen to the market?

Explain the relationship between total utility and marginal utility. Describe the Law of
Diminishing Marginal Utility. In the case of which of the following commodities the law
doesn’t work: Mango, Sweets, Sugar, Money, Rice, Wealth, and Ornament.

What is the difference between demand and the quantity demanded? “Remaining all other
things unchanged, if the price of the commodity rises, quantity demanded for the
commodity decreases; however, the demand for the commodity remains unchanged” – do
you agree with the statement. Justify your answer with examples. Show graphically the
impact of the recent spread of anthrax in Bangladesh on the demand for beef and also on
the demand for chicken in the country. Use graphs.

Mention 3 shift factors of PPF. Suppose, American and Japanese workers can each
produce 4 cars a year. An American worker can produce 20 tons of paddy a year, whereas
a Japanese worker can produce 5 tons of paddy a year. Assume that each country has 100
million workers. (i) Graph the PPF of American economy, (ii) for the United States, what
is the opportunity cost of a car?

The question: Assume that a supermarket has some fish that has reached its sell_by date.It was originally priced at 10dollars,but yesterday it was marked down to 5dollars for quick sale.It is now the end of the day and it still has not been sold .The supermarket is about to close and there is no one in the store who wants fish.What is the opportunity cost for the store of throwing the fish away?

Calculate the future value of R10 000 invested for 5 years at an interest rate of 7 %, interest compounded semi-annually.... a) R14 026 b)R14 106 c) R14 900 d) R16 234

Now consider an economy consists of four workers: Harry, Larry, Moe, and Curly, where Harry and Larry are brothers. Each works 10 hours a day and can produce two services: mowing lawns and washing cars. In an hour, both Harry and Larry can either mow one lawn or wash one car; Moe can either mow one lawn or wash two cars; and Curly can either mow two lawns or wash one car.

g. If there are 6 heterogeneous workers, how many kink points would be there on the PPF?
h. If there are 6 homogeneous works, how many kink points would be there on the PPF?
i. If there are 6 workers, how many kink points would be there on the PPF?
j. If there are 6 workers, these workers could be divided into 2 categories (high or low) according to
their skills, how many possible labor force compositions?
k. If there are N heterogeneous workers, how many kink points would be there on the PPF?
l. If N infinite, what would happen to the PPF?

Imagine that you are overseer on a small island that only produces two goods: cattle
and wheat. About a quarter of the land is not fertile enough for growing wheat, so this
is where cattle are grazed. What would happen (i.e., where would you move on the
production possibility frontier) if you tried to produce more and more wheat, extending
you planting to less fertile soil? Support your answer with a graph.

30. Predict how each of the following economic changes will affect the equilibrium price and quantity in the financial market for home loans. Sketch a demand and supply diagram to support your answers.

Imagine that you are overseer on a small island that only produces two
goods: cattle and wheat. About a quarter of the land is not fertile enough for
growing wheat, so cattle graze on it. What would happen to the production
possibility frontier if you tried to produce more and more wheat, extending
you planting even to the less fertile soil? Support your answer with a graph.