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. The market demand and supply for the good are given as Qd = 250 - 50P and Qs = 25 + 25P; A) Find the equilibrium price and quantity respectively B) Calculate the price elasticity of demand at equilibrium point. C) Calculate the price elasticity of supply at the equilibrium point. D) What is surplus or shortage if price is Birr 5
. Assume in a market individual firm supply function of a commodity X is given by Sx=-10 + 4Px and individual demand function is Dx =6 -2Px. There are 10 suppliers of commodity X with identical supply function and there are 100 buyers of the commodity X with identical demand function. Find market equilibrium price and quantity demanded.
Q1.a. Suppose that Happy Lemon Inc. issues a bond with a coupon of 4% paid annually. The
bond has a maturity of 30 years and a yield to maturity of 7%. An investor purchased this bond
at a fair price and holds the bond for 1 year.
i.
If the yield to maturity at the end of bond’s life changes to 8%, what will be the rate of
return that this investor is going to earn at the end of year 1? (
Hint
: The fair price of
the bond is simply the present value today of all future cash flows from an investment
in a bond)
ii.
Is the following statement correct? Elaborate your answer.
“Current yield overstates the return of premium bonds and understates that of discount
bonds”
Suppose a small country produces only food and clothing. A new agricultural technology is then introduced that doubles the amount of food that can be produced per year.
Use the 3-point-curve drawing tool to draw a new production possibilities boundary on the graph on the right, labeled b, reflecting the change in the agricultural technology. Properly label this line. Place end points one on horizontal and one on vertical axes.
Kumar spends all his monthly income of $20 on two goods, rice (x) and cooking oil (y). The price of oil is $1 per liter. Rice can be purchased at a government-run store and also on the free market. The price of rice is $1 per kilogram at the government store but he can only buy up to 10 kgs. In the free market, the price of rice is $2 per kg. Draw Kumar’s budget constraint assuming that the goods are divisible
Explain the benefits and detriments of putting a tax on a certain level of pollution or create a regulation that limits the amount of pollution allowed.
Discuss how to activate your learning mindsets for accounting information systems. The nature of accounting information systems is social technology at work in the accounting area. (e.g., MS Access, MS Power BI). Unlike qualitative questions, you cannot run the result with technology if you only understand 90% of the application knowledge.Technical knowledge is only one part of the solution, and we need to learn how to work with technology in a team for practical solutions.
If you can design a general-purpose AIS, even if it is simple, you know how to use some much more complicated AIS. There are at least 20 different AIS systems in the market. You can handle any system after you learned how to design a system. In addition, social technology also requires superior solutions and emphasizes user-driven criteria and diverse voices. Help you understand design thinking and how it works:
https://hbr.org/2018/09/why-design-thinking-works (Links to an external site.).
Show graphically and explain an allocative efficient level of abatement. Label your graph and explain.
If she spends all of her income on trouser and shoe during Christmas shopping, Rahel can afford 8 trousers and 8 pairs of shoes. She could also use her entire budget to buy 16 trousers and 4 pairs of shoes. If the price of a trouser is 400 Birr, then A) How much is Rahel’s income allocated for Christmas shopping? B) What is the budget line equation of Rahel? C) If Rahel’s utility function is U=T0.8S0.2, where T is Trousers and S is Pair of Shoes. What is the optimal combination of Trousers and Pair of Shoes for Rahel?
Suppose the relationship between the government’s tax revenue (T) and national income (Y) is represented by the equation T= 25+0.75Y. Plot this relationship on a scale diagram, with Y on the horizontal axis and T on the vertical axis. Interpret the equation.
Use the line drawing tool to draw the equation. Make sure to plot the vertical axis as one endpoint of the line. Properly label this line.
