Economics Answers

Assume that u r from anyone from the following family how can u utilize the limited resources to fulfill your needs a)family farm b)petty shop c)flower vender

A company has the capacity that can be used to produce a steel cup-board which it has been buying for Rs. 2000 each. If the company makes the steel cup-boards, it will incur materials cost of Rs. 800 per unit, labour costs of Rs. 400 per unit, and variable overhead costs of Rs. 200 per unit. The annual fixed cost is Rs. 25,00,000. Demand over the next year is estimated at 8,000 units. Would it be profitable for the company to make the steel cup-boards?

In a monopoly market, there are 2 consumers, their demand functions are: Q = 5 – p and Q = 10 - 2p. the monopolist ‘s cost function is C = 0.5q, and he decide to implement the two-part tariff strategy, i.e. each consumer pays a fixed/entry fee (a) and a price (p) for each unit consumed: T(q) = a + pq.

1. At a given price “p”, what is the fixed fee “a”?
2. What is the optimal fixed fee “a” and price “p”?

Explain briefly and give practical example on the following concepts. (3 points)

a) Explicit cist

b) Implicit cost

c) External cost

d) Social cost�

Urgent Corporation had earnings per share of $4 last year, and it paid a $2 dividend.

Total retained earnings increased by $12 million during the year, and book value per

share at year-end were $40. Urgent Corporation has no preferred stock, and no new

common stock was issued during the year. If Argent’s year-end debt (which equals its

total liabilities) was $120 million, what was the company’s year-end debt/assets ratio?

A consumer has $100 to spend on two goods X and Y with prices $3 and $5 respectively. Derive the equation of the budget line and sketch the graph

The budget deficit tends to decrease when

Q.1 A producer faces a fixed cost of Rs. 50 and a variable cost

Rs. 5 per unit of output when he produces less than 200 units of

output.

• Assuming that total cost function is linear, determine the

equation of the total cost of function.

• What is the break-even level of output if the price of output is

Rs. 10 per unit. Also draw the relevant graphs.

• Determine the producer’s net revenue if output is 12 units and

the price of output is Rs. 5, Rs. 10 and Rs. 15 respectively.

Suppose an increase in air pollution causes capital to wear out more

rapidly, doubling the rate of depreciation. How would this affect

economic growth?

How to reduce budget dificit in an economic advisor