for each: Immediate market Short run market Long run market 30. What are the determinants of Price elasticity of supply? 31. 32. Explain cross-price elasticity of demand? How is it measured? Analyse cross-price elasticity of demand for the following Substitute goods Complementary goods Independent goods 33. Define income elasticity of demand 34 Explain income elasticity of demand for the following 35. Normal goods Inferior goods What are regulated prices? Distinguish between price ceiling and price floor 36. Explain, with the help of diagrams, the implications of price ceiling and price floor for equilibrium quantity Questions on Topic 3 and 4 Distinguish between the following Accounting costs and economic costs 1. a) b) Explicit costs and implicit costs c) Short-run and long-run period d) Fixed costs and variable costs e) Short run costs and long run costs 2. John runs a bakery firm. He hires one helper at P20, 000 per year, pays annual rent of P5000 for his bakery, and spends P50, 000 for materials. He has P75, 000 of his own funds invested in equipment (baking machine, ovens etc.) that could earn him P7500 per year if alternatively invested. He has been offered P35,000 per annum to work as a baker for a competitor. He estimates his entrepreneurial talents are worth P25, 000. Total annual revenue from bread sales is P190,000. Calculate the accounting profit and economic profit for John's bakery firm. Make out the distinction between normal profit and economic profit Define the following concepts: a) Marginal Product (MP), Average Product (AP) and Total Product (TP) b) Marginal revenue. Average Revenue and Total Revenue 5. What is the law of diminishing retums? How is it relevant to the short run? 6. How does the change in the size of the variable factor (labour) in the short run influence the shape of the TP, MP and AP curves? 7. Complete the table below: Variable factor (labour) T.P AP MP 0 0 1 15 2 34 3 51 4 65 74 6 7 8 80 83 82 5 a) Present the above data graphically b) Show the three stages of production as per the law of diminishing returns