Economics Answers

John has a utility function
, where A, and are constants, B is burritos, and Z is pizzas. If the price of burritos, Pb is 10 and the price of pizzas, Pz, is N$5, and Y is N$1790, what is John’s optimal bundle

Suppose the US imposes prohibitive tariffs on all Australian exports , and in exchange, Australia retaliates on all imports from the US. Assuming that this trade war lasts for at least one year, discuss policy implications. Focus on variables such as exchange rates, balance of payments, output, inflation, interest rates, etc. May discuss from a single country’s point of view (either Australia or US). Address briefly social and/or cultural factors and their implications.

the consumer price index was 225 in 2006 and 234 in 2007. The nominal interest rate during this period was 6.5%. what is the real interest rate during this period?

Explain the impact of the following situations on the value of the exchange rate of a country under a floating exchange rate system :
An increase in local demand for imported goods
An increase in international demand for the country's local product

.A consumer splits their income equally between two goods. If the price of one good increases by 10% and their income increases by 5%, show that the consumer’s optimal consumption bundle will change despite them being able to afford their original bundle

Another explanation for why queues may exist is so restaurants can practise price discrimination, which is sometimes illegal. By restricting the quantity supplied, the owner can adopt ‘behind the counter’ or ‘not on the books’ policies that give priority seating and special bookings to customers who are willing to pay more. In addition, because these payments are not on the records the owner does not pay taxes on them.

a) With the help of an appropriate graph (for simplicity, assume the seller is a monopoly), show how a firm can profit by restricting the quantity it sells (while keeping the legal price the same), while practising price discrimination with a subset of consumers.

Effect on the price and output of fresh maize of adverse conditions,The effect on the price and output of oranges of an increase in consumer income

Using the demand and supply model, with regards to the cocoa industry; discuss the statement, "with demand forecast to outstrip supply, a crisis is looming for the industry"

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.

Your client is a parent who lent $40,000 to her son to provide a
short-term housing loan. The agreement is that the son will repay
$50,000 at the end of five years.
Reconsider this question in light of the following facts. The loan was
made to the son without any formal agreement and without any
security provided for the sum lent. In addition, the client (the
mother) has informed you that she told her son that he need not
pay interest. However, the son repaid the full amount after two
years and included in his payment an additional amount which was
equal to 5% pa on the amount borrowed. Only one cheque was
presented for the total amount.
Requirement:
Discuss the effect on the assessable income of the parent