6. (15 points) Suppose you have 100 euros to spend before you fly back to the UnitedStates. You wish to purchase jewelry priced at $160 (U.S.) in a duty-free shop at theairport. Euros can be bought for $1.32 and sold for $1.24. The owner of the duty-free

Typed Solution:Part 1.If sanjay accepts the deal he will pay an equivalent to $164.Explanation:He…

Answered: 6. (15 points) Suppose you have 100…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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1. (T/F) The trade tariffs imposed on Chinese product unambiguously increased U.S. producer surplus and consumer surplus, while total U.S. welfare decreased. 2. (T/F) Over the past two years, the prices of new cars and used cars showed significant growth. The price increases in new and used cars were both caused by the decrease in supply due to the semiconductor shortage. 3. (T/F) Charles dislikes Red Vines Licorice®. His indifference curves are positively-sloped lines or curves with positive vertical intercepts with Red Vines Licorice on the horizontal axis and other snacks on the vertical axis. 4. (T/F) CPI (Consumer Price Index) measures the cost for a fixed amount of products in the same basket. One criticism is that it ignores the substitution effect and could overestimate the actual price increase.
2. (a) A country's current GDP is $1,000. Its annual growth rate is expected to average 5% over the next 10 years. What's its expected GDP in 10 years? 70 -=14years to double the GDP to $2000. In 10 years, GDP will be: 5 2000 × 14 10 ¿$1,428
(7 points) Suppose Backbeat BBQ, Dave Grohl's one-man catering company, offers two types of membership plans. Plan A has an entry fee of $20 with a price of $2 per unit. Plan B has an entry fee of $40 with a price of $1 per unit for using the service. Let x be expenditure on all other goods and y be the units of consumption of Backbeat BBQ's services, and suppose you have an income of $100. A. Write down the budget equation that you would have after you paid the entry fee for each of the two plans. B. If your utility function is xy, how much y would you choose in each case? C. Which plan would you prefer? Explain.
(Figure: Demand and Supply of Sugar) Use Figure: Demand and Supply of Sugar. A factor that may have shifted the supply from S₁ to S₂ is: Price (per pound) $50 40 40 30 25 20 15 10 0 100 200 S₁ $2 D 500 600 300 400 Quantity of sugar (per month) better technology in the production of sugar. increased demand. lower labor productivity in sugar production. increased prices of substitutes in the production of sugar.
please answer (i)(ii)(iii)
1
3. (20%) Elasticity (related to Total Revenue): (Please show your steps & decision rules) The demand schedule for a specific computer software is as follows- Please use the relationship between Elasticity and TR (total revenue) to make judgment. Price (per copy of software) $630 640 Quantity demanded (in million) 64 61 660 59 690 55 750 53 765 50 775 49 820 47 850 45 860 43 a. What type of elasticity (elastic, inelastic, or others) is this demand if the price of this software decreases from $750 to $640? (2%) explain why and show your steps. b. What type of elasticity (elastic, inelastic or others) is this demand if the price of this software increases from $690 to $765? (2%) explain why and show your steps. At what price is total revenue a maximum and what quantity sold? 2% Show your calculation/numbers d. When the price increases from $660 to $775, is the demand for this software elastic or inelastic or others? Explain why. 2% e. When the price decreases from $850 to $765, is the…
5. (12 pts-2 points for each subpart) Spring break travel prices are estimated to be 8-10% higher this year. A resort in South Padre decided to run a price promotion for room rentals. They know the elasticity of demand for resort rooms is -2.50. During the price promotion, they expect to be at full capacity with 500 rooms sold per night. Before the price drop, they sold an average of 375 rooms a night. Round to the nearest two decimal places for calculations. a. Does this resort have an inelastic or elastic own-price elasticity of demand? Interpret the OPE given above. b. For them to be able to achieve this increased sale, what would the percentage change in price need to be? c. If the price before the promotion was $250 per night, what is the new price? d. Calculate the revenue before the price drop. e. Calculate the revenue after the price drop. f. Is the price drop a good marketing strategy, given all else is same?
(NON-RENEWABLE RESOURCES) The demand and supply functions for oil for the current generation (in million barrels) is: Demand: Qd = 250 – 5P Supply: Qs = 5P a. Other things being equal, assume that the available oil supply is 200 million barrels. Calculate and graph the efficient allocation of resources been the two generations. b. Given the limited supply of oil as a non-renewable resource, should the resource be managed by a monopoly? Explain your answer. Thank you for the help Bartleby! I really need it!
1. Suppose that you are in charge of purchasing for a U.S. corporation that is planning to acquire a large number of new computers. The company's computer specialist has identified two models, one Japanese-made and one U.S.-made, that meet the necessary specifications. Since the two models are essentially equivalent, the company will buy the one with the lower price. Suppose the U.S.-made computer costs $2,400, and a similar Japanese-made computer costs 242,000 yen. If the nominal exchange rate is 110 yen per dollar, which computer is a better buy? (Hint: calculate the real exchange rate for computers)

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6. (15 points) Suppose you have 100 euros to spend before you fly back to the United States. You wish to purchase jewelry priced at $160 (U.S.) in a duty-free shop at the airport. Euros can be bought for $1.32 and sold for $1.24. The owner of the duty-free