7:20 < Back File Details MANAGERIAL ECONOMICS Russ Kashian, PhD Economics 737 This exam needs to submitted into the Canvas Assignment Box by Wednesday June 12, 2024 by 11:59 pm. Note your grade is based on a percentage not a raw score. Pleases show your work. If you use excel, it is helpful to submit the excel spreadsheet. Finally, I am provided Word, Excel, and Adobe PDF on my UWW computer-If I can't open the exam, I cannot grade the exam. If you have any questions about the format, please contact me. 1) Keep in mind that management needs to recognize the demand for their product. While this is an obvious statement, it cannot be over emphasized. For example, the inverse demand for Tires is: P=81-25Q The current market price is $20 and average income (I) is $10,990. (19 Points) a) Calculate the markets total Demand? (4 Points) b) Calculate the market's consumer surplus. (4 Points). Draw the Demand Curve and identify the price quantity and label the axes for price and quantity. c) Calculate the price elasticity of demand at the equilibrium output. (4 Points) d) Is the Price elasticity of demand calculated in Question # 1c elastic or inelastic? (4 Points) e) Based on the income elasticity of demand, is this product a normal good or an inferior good? (3 Points) 2) Suppose that you have estimated the following output function where L is labor and K is capital: Y = 0.66KL (23 Points) You know that the current price of labor is $13 and capital cost is $1 per per machine (capital). You currently use 81 units (machines) of capital. The price of the output is $60 As we compete both internationally and within markets, the challenge of wages and technology create a balancing act relative to the capital/labor ratio. In addition, rising ◄ Previous Next 2 Dashboard Calendar To Do Notifications Inbox

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) Keep in mind that management needs to recognize the demand for their product. While this is an obvious statement, it cannot be over emphasized. For example, the inverse demand for Tires is: P= 81-250, The current market price is $20 and average income (I) is $10,990. (19 Points) a) Calculate the markets total Demand? (4 Points) b) Calculate the market's consumer surplus. (4 Points). Draw the Demand Curve and identify the price quantity and label the axes for price and quantity. c) Calculate the price elasticity of demand at the equilibrium output. (4 Points) d) Is the Price elasticity of demand calculated in Question #1c elastic or inelastic? (4 Points) e) Based on the income elasticity of demand, is this product a normal good or an inferior good? (3 Points)