An individual sets aside a certain amount of his income per month to spend on histwo hobbies, collecting wine and collecting books. Given the information belowillustrate the demand curve for wine50-Wine Price Book Price Wine$10BooksBudget$80040-$84050$20$40$8$82050$800$800105030어100-20-90-80-70-10-80-APCC50+40-0-30-104050203020-Wine10-L20+0 10 20 30 40 50 60 70 80 90 100Price

In economics, the demand curve is used to graphically represent the relationship between quantity…

Answered: An individual sets aside a certain…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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The following graph shows Raphael's weekly demand for apple pie, represented by the blue line. Point A represents a point along his weekly demand curve. The market price of apple pie is $3.00 per slice, as shown by the horizontal black line. Raphael's Weekly Demand 7.50 6.75 6.00 5.25 Demand 4.50 3.75 Price 3.00 2.25 1.50 0.75 4 10 12 14 16 18 20 QUANTITY (Slices of apple pie) From the previous graph, you can tell that Raphael is willing to pay s for his 8th slice of apple pie each week. Because he has to pay only $3.00 per slice, the consumer surplus he gains from the 8th slice of apple pie is S Suppose the price of apple pie were to fall to $2.25 per slice. At this lower price, Raphael would receive a consumer surplus of 5 from the 8th slice of apple pie he buys. The following graph shows the weekly market demand for apple pie in a small economy. Use the purple point (diamond symbol) to shade the area representing consumer surplus when the price (P) of apple pie is $3.00 per slice.…
Suppose Mimi demands 12 pieces of sushi when she earns $3,000 a month. When she gets a raise, she now earns $4,000 a month and demands 16 pieces of sushi. What is Mimi's income elasticity of demand for sushi? 0.5 0 1 O 0.67 O 1.5
Jane thinks that two 6-ounce cans of beer are exactly as good as one 12-ounce can of beer. Suppose that these are the only sizes of beer available to her and that she has $30 to spend on beer. Suppose that an 6-ounce beer costs $0.5 and a 12-ounce beer costs $2. What is her demand for 12-ounce beer?
3.1 BAD Enterprises is considering increasing the price of its harmonicas,currently $20, by 25 per cent. BAD’s current revenue is $12,000 a month,and the PED for its harmonicas is estimated to be 1.8.a. Calculate the effect of the price change on BAD’s revenue.b. BAD now considers increasing its advertising budget to restore its salesrevenue to its previous level. BAD is currently spending $1,500 a monthon advertising and estimates its AED to be 1.5. What will its new budgethave to be?c. What can you say about what will happen to profit in both (a) and (b)compared with the original level of profit? 3.5 MK Corp estimates that its demand function is as follows:Q ¼ 400 12:5P þ 25A þ 14Y þ 10P where Q is the quantity demanded per month, P is the product’s price(in $), A is the firm’s advertising expenditure (in $’000 per month), Y is percapita disposable income (in $’000), and P * is the price of AJ Corp.a. During the next five years, per capita disposable income is expected toincrease…
ECONOMICS LECTURE NOTE 5.1.3 Example Use the table below to answer the questions that follows Commodity x Quantity Commodity y Quantity Marginal utility 60 Average utility 1 30 2 50 2 27 3 35 3. 22 4 15 4. 18 5 5 15 6. 6. 12 iii. Which of the commodities would he pay higher price when 4 units are consumed? Suppose the price of X is 5 and that of Y is 4. How many of the quantity of X and Y should be consumed in order for the consumer to be in iv. equilibrium. If price of X increase to 10 whiles that of Y remains the same, explain how the equilibrium conditions will behave.
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The Utility theory used in economics holds the belief that an item or service's utility is a measure of the satisfaction that the consumer will derive from the consumption of that particular good or service. Explain in a graph and short paragraph what it wold look like in today's Beef industry if the price of beef goes up Marginal Utility for beef consumption goes down..
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if there is any diagram can you add it. Given the following demand and supply equations: QD = 10 - 0.8P + 5Y + A QS = -10 + P where Q = quantity (million units per month), P = price (€ per unit). Y = average monthly income (€000) and A monthly advertising expenditure (€000). Suppose average monthly income is €4,000 and monthly advertising expenditure is €50,000: (a) Find the market equilibrium price and quantity. (b) Find total welfare when the market is in equilibrium. (c) Find the price elasticity and income elasticities of demand and price elasticity of supply at equilibrium. Interpret your results. (d) What would be the effect of a price ceiling of €60? Explain. (e) Suppose a tax of €8 per unit is introduced: (i) What is the effect on market price and quantity? Explain. (ii) What is the impact of the tax on total welfare? Explain. (iii) How is the incidence of the tax shared between the consumer and the supplier? Explain
Please sir provide the answer of last part of the question (part-d)
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