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Paul and his friend Tori make decorative art out of silver spoons. They want to start a business that they can easily dissolve when they move on to their next project. Which of these will suit their needs best?
Question 4
a.As the price of oranges rises, the demand for oranges falls, ceteris paribus.” Explain.
b. “The price of a bushel of wheat was $3.00 last month, and $2.50 today. The demand curve for wheat must have shifted leftward between last month and today.” Discuss.
c. Some goods are bought largely because they have ‘snob appeal.’ For example, the residents of Beverly Hills gain prestige by buying expensive items. In fact, they would not buy some items unless they are expensive. The law of demand, which holds that people buy more at lower prices than at higher prices, obviously does not hold for the residents of Beverly Hills. The following rules apply in Beverly Hills: high prices, buy; low prices, don’t buy.” Do you agree? Discuss.
a.As the price of oranges rises, the demand for oranges falls, ceteris paribus.” Explain.
b. “The price of a bushel of wheat was $3.00 last month, and $2.50 today. The demand curve for wheat must have shifted leftward between last month and today.” Discuss.
c. Some goods are bought largely because they have ‘snob appeal.’ For example, the residents of Beverly Hills gain prestige by buying expensive items. In fact, they would not buy some items unless they are expensive. The law of demand, which holds that people buy more at lower prices than at higher prices, obviously does not hold for the residents of Beverly Hills. The following rules apply in Beverly Hills: high prices, buy; low prices, don’t buy.” Do you agree? Discuss.
Question :
The minimum wage in year 1 is $1 higher than the equilibrium wage. In year 2, the minimum wage is increased so that it is $2 above the equilibrium wage. We observe that the same number of people is working at the minimum wage in year 2 as in year 1. Does it follow that an increase in the minimum wage does not cause some workers to lose their jobs? Explain your answer.
The minimum wage in year 1 is $1 higher than the equilibrium wage. In year 2, the minimum wage is increased so that it is $2 above the equilibrium wage. We observe that the same number of people is working at the minimum wage in year 2 as in year 1. Does it follow that an increase in the minimum wage does not cause some workers to lose their jobs? Explain your answer.
Question2:
a. Consider public policy aimed at smoking;
i. Studies indicate that the price elasticity of demand for cigarettes is about 0.4. If a pack of cigarettes currently costs $2 and the government wants to reduce smoking by 20 percent, by how much should it increase the price?
ii. Studies also find that teenagers have higher price elasticity than do adults. Why
might this be true?
b. Suppose that business travelers and vacationers have the following demand for airline tickets from New York to Boston:
Price Quantity Demanded Quantity Demanded
(business travelers) Quantity Demanded
(vacationers)
$200 2,000 tickets 800 tickets
$250 1,900 tickets $ 600 tickets
$300 1,800 tickets 400 tickets
As the price of tickets rises from $200 and $250, what is the price elasticity of demand for
(i) business travellers and (ii) vacationers? (Use the midpoint method in your calculations)
ii. Why might vacationers have a different elasticity from business travellers?
a. Consider public policy aimed at smoking;
i. Studies indicate that the price elasticity of demand for cigarettes is about 0.4. If a pack of cigarettes currently costs $2 and the government wants to reduce smoking by 20 percent, by how much should it increase the price?
ii. Studies also find that teenagers have higher price elasticity than do adults. Why
might this be true?
b. Suppose that business travelers and vacationers have the following demand for airline tickets from New York to Boston:
Price Quantity Demanded Quantity Demanded
(business travelers) Quantity Demanded
(vacationers)
$200 2,000 tickets 800 tickets
$250 1,900 tickets $ 600 tickets
$300 1,800 tickets 400 tickets
As the price of tickets rises from $200 and $250, what is the price elasticity of demand for
(i) business travellers and (ii) vacationers? (Use the midpoint method in your calculations)
ii. Why might vacationers have a different elasticity from business travellers?
Question2:
Widgets are provided by a competitive constant-cost industry where each firm has fixed costs of $30. The following chart shows the industry-wide demand curve and the marginal cost curve of a typical firm:
INDUSTRY-WIDE DEMAND FIRM’S MARGINAL COST CURVE
Price l Cost Quantity Quantity Marginal Cost
$5 1500 1 $5
10 1200 2 10
15 900 3 15
20 600 4 20
25 300 5 25
30 200 6 30
35 140 7 35
40 50 8 40
a.What is the price of a widget?
b. How many firms are in the industry?
For the remaining four parts of this question, assume that the government imposes an excise tax of $15 per widget.
c. In the short run, what is the new price of widgets?
d. In the short run, how many firms leave the industry?
e. In the long run, what is the new price of widgets?
f. In the long run, how many firms leave the industry?
Widgets are provided by a competitive constant-cost industry where each firm has fixed costs of $30. The following chart shows the industry-wide demand curve and the marginal cost curve of a typical firm:
INDUSTRY-WIDE DEMAND FIRM’S MARGINAL COST CURVE
Price l Cost Quantity Quantity Marginal Cost
$5 1500 1 $5
10 1200 2 10
15 900 3 15
20 600 4 20
25 300 5 25
30 200 6 30
35 140 7 35
40 50 8 40
a.What is the price of a widget?
b. How many firms are in the industry?
For the remaining four parts of this question, assume that the government imposes an excise tax of $15 per widget.
c. In the short run, what is the new price of widgets?
d. In the short run, how many firms leave the industry?
e. In the long run, what is the new price of widgets?
f. In the long run, how many firms leave the industry?
A series of follow-up questions that would be relevant to the tax return and record those answers also.
1. Upload, in a word processed document, a list of the questions you asked, the recorded answers and the reasons for asking these questions.
2. Provide appropriate taxation advice to the client and submit a written summary of the advice given.
3. Would it be necessary to liaise with anyone else? With whom and why?
1. Upload, in a word processed document, a list of the questions you asked, the recorded answers and the reasons for asking these questions.
2. Provide appropriate taxation advice to the client and submit a written summary of the advice given.
3. Would it be necessary to liaise with anyone else? With whom and why?
The Stopdecay Company sells an electric toothbrush for $25. Its sales have averaged 8,000 units per month over the past year. Recently, its closest competitor, Decayfigh- ter, reduced the price of its electric toothbrush from $35 to $30. As a result, Stopde- cay’s sales declined by 1,500 units per month.
a. What is the arc cross elasticity of demand between Stopdecay’s toothbrush and Decayfighter’s toothbrush? What does this indicate about the relationship between the two products?
b. If Stopdecay knows that the arc price elasticity of demand for its toothbrush is −1.5, what price would Stopdecay have to charge to sell the same number of units as it did before the Decayfighter price cut? Assume that Decayfighter holds the price of its toothbrush constant at $30.
c. What is Stopdecay’s average monthly total revenue from the sale of electric toothbrushes before and after the price change determined in part (b)?
d. Is the result in part (c) necessarily desirable?
a. What is the arc cross elasticity of demand between Stopdecay’s toothbrush and Decayfighter’s toothbrush? What does this indicate about the relationship between the two products?
b. If Stopdecay knows that the arc price elasticity of demand for its toothbrush is −1.5, what price would Stopdecay have to charge to sell the same number of units as it did before the Decayfighter price cut? Assume that Decayfighter holds the price of its toothbrush constant at $30.
c. What is Stopdecay’s average monthly total revenue from the sale of electric toothbrushes before and after the price change determined in part (b)?
d. Is the result in part (c) necessarily desirable?
what are the benefits of households into international trade?
An economy with $55000000000 annual GDP grow 10% a year for 10 years continuously ,how much value it is going to have after 10 years of growth?
Economics
1. describe the distinction between legislative requirements and professional standards
2. What part of the legislation provides details of how much income tax must be paid and what does it state?
2. What part of the legislation provides details of how much income tax must be paid and what does it state?
