Economics Answers

Compare and contrast the Linear Stages of Growth Model (Modernization Theory) and the Neoclassical Counterrevolution (Market Fundamentalism). In your analysis, try to address the causes of underdevelopment and how development best occurs in developing countries

Coross price elasticity of a gquantity demand 807.184 ant px =5 py = 15?

he price of running shoes is above the equilibrium price, there will be an excess supply of running shoes.

5. Explain the distinction made in economic analysis between the short run and the

long run.

4. “If it were not for the law of diminishing returns, a firm’s average cost and average variable

cost would not increase in the short run.” Do you agree with this statement? Explain.

Given the following Demand and supply function: Q_{d = 12 - P} and Q_{s = 8.4 + 0.5P} , 

then answer the following questions.  

i. Calculate the market clearing price and quantity. 

ii. Determine, whether surplus or shortage exist at price level of 2 birr and 3 Birr. 

iii. Compute price elasticity of demand and supply at equilibrium level of price and 

quantity 

iv. Determine the nature of price elasticity of demand and supply and interpret the result.  

An employee obtained a loan of P100,000 at the rate of 6% compounded in order to build a house. How much must he pay monthly to amortize the loan within a period of 10 years?

plot the supply and demand curve Qd= 3000-10P Qs=-10000 + 10P

You are an analyst employed by a yacht manufacturer that last year sold 30,000 luxury yachts at $500,000 each. Your market research indicates that:

i) the price elasticity of demand for your aircrafts in −0.5. (or +0.5 in absolute value); 

ii) the income elasticity of demand for your aircrafts is +2.6; and 

iii) the cross price elasticity for your aircrafts with respect to the price of a comparable jet manufactured by a competitor is +1.4. 

 Now suppose that the only change you expect is a 6% increase in the price of your aircraft. Estimate sales this year and discuss the impact on total revenues. (5 MARKS)

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The market supply curve is the horizontal sum of all the individual supply curves.