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Business

Economics

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ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Part D As part of Government's IDIF initiative, a small technology company in the Eastern Region is developing laptop computers as substitutes to those imported from abroad. Based on market surveys, the company believes the quantity Q (in thousands of units) that will be demanded by consumers is related to the price P (in thousands of cedis) by the relationship Q= 48 – 2P', P>0. a. Find the price elasticity of demand when the price of the laptop is GHC 3,000. b. Determine where the demand is elastic, inelastic, and of unit elasticity with respect to price. c. Interpret the results of part (b) in terms of the behaviour of total revenue as a function of price.
Star wars coffee mugs are traded in a competitive world market with a price of R180 per cup. Unlimited quantities are available for import into South Africa at this price. On average 10 000 kg are traded each month. The elasticity of demand has been estimated at -0.81 and elasticity of supply at 3.51. Derive the demand equation for the star wars coffee mug. . . A. Qd = 12 800 - 45P B. Qd = 15 200 - 35P C. Qd = 18 100 - 45P D. Qd = 20 000 - 50P Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.
v Question Completion Status: 28 24 20 S2 16 S1 ND1 D2 01 0 4 4 8 12 16 20 24 Q 14. If this figure depicts the market for product X, and the demand for product X changed from D2 to D1 as a result of an increase in the price of a related product Y from $45 to $55, the cross price elasticity of demand for product X (calculated at Px = $18) is and the two products are O "1/6, substitutes" "6, substitutes" O "-6, complements "1/6, complements" QUESTION 15. Click Save and Submit to save and submit. Click Save All Answers to save all answers. Save All Answers 46 24 L AUG P 13 21 .... 284
The underground fare in your town has just been increased from a current level of $1.00 to $1.20 per ride. As a result, a 10 per cent decline in the number of passengers was noticed. a) Compute the price elasticity of demand for underground rides. Answer (enter a numerical value): b) Would you expect an increase or a decrease in revenues resulting from this price change? Answer (select): c) If the fare was reduced back to $1.00, what impact would you expect on the number of passengers? Answer (select):
Qs.5: Fill in the blanks: 1. The co-efficient of Cross elasticity of demand for Pepsi and Coke will be............ 2. The co-efficient of income elasticity of demand for used tires is expected to be.......... 3. If the co-efficient of cross-elasticity of demand is negative 20, then the two goods are.... 4. If the co-efficient of income elasticity of demand is +10, then the goods are....... 5. Solve the following: Your budget is $10 The Price of good A = $2 The Price of good B= $3 The price of good C-= $5 Mu of good A=4 Mu of Good B=9 Mu of Good C= 20 How many items of good A can you buy?----- How many items of good B can you buy?---- How many items of good C can you buy?-
2) Imagine that you have started a firm and own the patent for a new technology that allows for the 3D printing of food. This is a huge nutritional breakthrough since the printer can provide nutritional food for years. Since you are the first with this technology and have patented it, your firm is the only firm that can produce and sell this type of printer. There are no close substitutes for your printer and your data indicates weekly demand is given by the equation Qa = 9000 - 2P. a) Your production analysis indicates that your firm's cost function is C(Q) = F +Q². Illustrate the market, 2 showing the inverse demand curve, the MR curve and the MC curve. Then, compute and illustrate your firm's profit maximizing price and quantity of the printer. How low must the fixed cost be to ensure that the firm is making positive profits? Make sure to clearly label all relevant curves. Finally, what is the markup on the printer (measure markup in the following way: Price/MC)? b) Redraw the…
You collected study survey data for the market of wheat and corn. The data indicates that if wheat costs $5, then 100 bushels of wheat are demanded, and 60 bushels of corn are demanded. If wheat costs $3, then 200 bushels of wheat are demanded, and 100 bushels of corn are demanded. If corn cost $2, then 125 bushels of corn are demanded. Can you estimate price elasticity of demand for either good? Select one: Oa. Yes. Price elasticity of supply for corn is 1.33 O b. Yes. Price elasticity of demand for corn is 1.33 O C. No. We need more information. O d. Yes. Price elasticity of demand for both good is 1.33 e. Yes. Price elasticity of demand for wheat is 1.33
b
If the price elasticity of demand of for gasoline is 1.8, then a 15% decrease in quantity demanded is caused by ....
When the price of a product increases by 20 percent, the quantity demanded decreases by 40 percent. The price-elasticity of demand coefficient for this product is:
QUESTION 2 Replicas of popular mid-century furniture and homeware can be highly sought after by interior designers. Suppose a company sold 1000 replica Eames chairs for a price of $600 each. However, when they set the price at $750, they only sold 750. Which of the following statements are true: The point price elasticity of demand for replica Eames chairs at a price of $600 is unit elastic. At a price of $600 per chair, a 1% increase in the price of replica Eames chairs would lead to a 1% decrease in the quantity of chairs sold. The point price elasticity of demand for replica Eames chairs at a price of $600 is 0.0239 (to four decimal places). The point price elasticity of demand for replica Eames chairs at a price of $600 is 0.02 (to two decimal places).
Problem 6. The respective demands for margarine (marg) and for meals away from home (mah) in the UK during the period 1920-1937, as functions of personal income r, were estimated to be Dmarg = Ar-0.165 and Dmah = Br2.39, for suitable constants A and B. Find and interpret the (Engel) elasticities of Dmarg and Dmah with respect to r.