Economics Answers

Zambia and Malawi are able to produce maize and fish using equivalent resources as shown below:
Zambia Malawi
Maize Fish maize Fish
10 0 50 0
8 2 40 5
6 4 30 10
4 6 20 15
2 8 10 20
0 10 0 25

a. Which country has an absolute advantage in the production of maize?
b. Which country has an absolute advantage in the production of fish?
c. Which country has a comparative advantage in the production of maize?
d. Which country has a comparative advantage in the production of fish?
e. Explain the reason for International trade based on comparative advantage.

Multinationals generally have production plants in a number of countries. Consequently, they can move production from expensive locations to cheaper ones in response to various economic developments—a phenomenon called outsourcing when a domestically based firm moves part of its production abroad. If the dollar depreciates, what would you expect to happen to outsourcing by American companies? Explain and provide an example.

A nation with fixed quantities of resources is able to produce any of the following combinations of carpet and carpet​ looms:
Yards of carpet
​(Millions)
Carpet looms
​(Thousands)
100100
00
8080
1515
6060
2727
4040
3636
2020
4242
00
4545

These figures assume that a certain number of previously produced looms are available in the current period for producing carpet.
​1.) Using the multipoint curve drawing​ tool, plot the six points that make up the PPF given in the table above​ (with carpet on the vertical​ axis). Properly label your curve.
Carefully follow the instructions above and only draw the required object.  

Suppose the oil price in world market is $60 per gallon,the u.s domestic demand curve of oil is Qd=200-2q and a domestic supply curve is Qs=p
a) if u.s government imposes a tariff of$15 per gallon,what will be the US price amd the level of import?How much revenue will the government earn from tariff?How large is the dead weight loss?
b)if the US government has no tariff but imposes an import quota of 25,what will be the domestic price?what is the cost of the quota for US consumers of the oil?what is the gain for US producers?

To prove the intra industry trade theory empirically which assumption has been altered as compared to the HOS model.

1. For each of the following cases, calculate the arcprice elasticity of demand, and state whether demandis elastic, inelastic, or unit elastic.
a. When the price of milk increases from $2.25 to$2.50 per gallon, the quantity demanded fallsfrom 100 gallons to 90 gallons.

Determine the average function for each of the following total functions:
a. Total Revenue = 100Q-Q^2
b. Total cost = 1,000 + 10Q + 0.01Q^2
c. Total Profit = 50Q - 0.1Q^2 - 1,000

Given the firm demand function Q = 55 - 0.5P
(where P = Price and Q = rate of output), and the total cost function
TC = 20 + Q + 0.2Q^2
where TC = Total cost, determine
(a) The Total revenue function for the firm.(Hint: To find the total revenue function,solve the demand function for P and then multiply both sides of the equation by Q.)
(b) The marginal revenue and marginal cost functions and find the rate of output for which marginal revenue equals marginal cost.
(c) An equation for profit by subtracting the total cost function form the total revenue function. Find the level of output that maximizes total profit. Compare your answer to that obtained in part (b). Is there any corrrespondence between these answers?

Given the following total revenue (TR) and total cost(TC) equations, determine the output rate that would result in a breakeven(i.e.,zero profit) situation for a firm
TR = 51Q - Q^2
TC = 625 + Q

Given the following function that relates total revenue (TR) to output (Q),

TR = 20Q - 2Q^2
determine
a. The marginal and average cost functions.
b. The Marginal revenue function
C. The rate of output for which marginal revenue is zero.
d. if there is any connection between your answer to parts (a) and (c)? Explain