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what is the difference between austerity and stimulus? which tack does the european union follow? how is it different from what the united states has done? which do you think is a better approach. please answer in detail.
In the long run all cost are fixed
The utility function for a consumer utility is U=30Q1^½Q2^½. if the price per unit of Q1 is ksh 10 and ksh 5 per unit of Q2, determine quantities Q1 and Q2 that the consumer should have ti maximize utility if the consumer budgeted kdh 350
Suppose that in the model of Myers and Majluf (1984) the parameters take on the following values: λ = 0.60, H = 3, L = 2, I = 1.0, R = 1.25, r = 10 per cent. Use the above data and answer the following questions: (a) Does the model have a separating equilibrium, a pooling equilibrium, or both? (b) Based on your answer to question (a), what is the gain in wealth of the current shareholders of a firm that announces the issuing of new shares to finance the project of investment?
Tri-pak Packaging produces cardboard boxes that are sold in bundles of 1000 boxes. The market is highly competitive, with boxes currently selling for R100 per thousand. Tri-pak’s total and marginal cost curves are: TC = 3,000,000 + 0.001Q2 MC = 0.002Q where Q is measured in thousand box bundles per year.
The price elasticity of demand is -0.9. The income elasticity of demand is 0.5. The cross-price elasticity of demand between your good and a related good is 2.0. What can you determine about consumer demand for your product from this information
The demand for a commodity is given by P(Q + 1) = 231 and the supply is given by P - Q = 11 , find the consumer and produce surplus.
Woolworth wants to increase its total revenue from Zambia market. The company already identified two type of customers as high income and medium income and plans to offer a 10%
discount on the cloths it sells. The table shows the sells made from the two groups
High income customers
(sales per month in Kwacha)
Medium income customers
(sales per month in Kwacha)
Sales before 10% discount 1.55 million 1.50 million
Sales after 10% discount 1.65 million 1.70 million
(a) Calculate the price elasticities of demand for high income customers and medium income
customers.
(b) Do you support the discount applied for both type of customers? Explain based on your
results from (a)
As economic/business consultant to the dominant firm in a particular market, you have discovered that, at the current price and output, demand for your customers’ product is price inelastic. What advice regarding pricing would you give to management? Explain.
- A typical family on Sandy Island consumes only juice and cloth. Last year, which was the base year, the family spent $40 on juice and $25 on cloth. In the base year, juice $4 a bottle and cloth is $5 a length. This year, juice is $4 a bottle and cloth is $6 a length. Calculate:
- The CPI basket
- The CPI in the current year
- The inflation rate in the current year
