Price Effect: After a change in price, each additional unit was sold at a changed price. This will result in an increase or decrease in revenue of the producer. This is known as the price effect on the revenue. Quantity effect: After an increase or decrease in price, fewer units are sold which results in lower revenue. This is known as the quantity effect on the revenue.

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Answer 1

Question

Chapter 9, Problem 1P

To determine

Concept Introduction:

Price Effect: After a change in price, each additional unit was sold at a changed price. This will result in an increase or decrease in revenue of the producer. This is known as the price effect on the revenue.

Quantity effect: After an increase or decrease in price, fewer units are sold which results in lower revenue. This is known as the quantity effect on the revenue.

Expert Solution & Answer

Explanation of Solution

a. Price and Quantity effect for BASF.

From the table, it is clear that if BASF will produce 10 more tons, then the price will fall from $4 to $3 per ton. So, with the fall in price BASF has to reduce price of each of the 40 tons.

Price effect will be:

EBK ESSENTIALS OF ECONOMICS, Chapter 9, Problem 1P , additional homework tip 1

Quality effect will be the price at which additional 10 tons were sold:

EBK ESSENTIALS OF ECONOMICS, Chapter 9, Problem 1P , additional homework tip 2

As the marginal cost is zero, additional production will not incur any extra cost on BASF, but it will incur either loss or revenue due to an increase in production; therefore it has no incentive to produce 10 tons of an additional unit.

Conclusion:

Thus, the price effect is EBK ESSENTIALS OF ECONOMICS, Chapter 9, Problem 1P , additional homework tip 3 and the quantity effect is $30.

b. Price and Quantity effect for BASF when Roche enters the market:

If BASF wants to produce 10 more tons then the price will fall from $4 to $3 per ton.

Due to the duopoly type of market, with the fall in price, BASF must reduce the price on each of the 20 tons only.

Price effect will be:

EBK ESSENTIALS OF ECONOMICS, Chapter 9, Problem 1P , additional homework tip 4

Quality effect will be the price at which an additional 10 tons were sold:

EBK ESSENTIALS OF ECONOMICS, Chapter 9, Problem 1P , additional homework tip 5

As the marginal cost is zero, the additional production will not incur any additional cost on BASF. Revenue will be increased by $10 with an increase in production.

Conclusion:

Thus, the price effect is EBK ESSENTIALS OF ECONOMICS, Chapter 9, Problem 1P , additional homework tip 6 and the quantity effect is $30.

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Respond to B.A. I have chosen Gross Domestic Product (GDP) as the macroeconomic indicator to review and provide a forecast prediction. Based on the current trend I predict a 2% annual GDP growth rate, indicating an unstable economy due to the impact of Donald Trump's tariffs on some countries and other other economic factors. This growth rate is lower than the historical average , indicating a slowdown in economic expansion. Overall, the forecast suggests a modest growth in GDP, but with potential risks and uncertainties ahead. But if he reverse his tariff policies, I think it could possibly result in a strong economic growth. As the removal of tariffs would likely minimize the costs for businesses and consumers and also rise trade and economic activities. Provide feedback/comments this post. You could agreement or disagreement (including why you agree or disagree). Or you could expand on this post by sharing different views and predictions.

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ECON 2106: Microeconomics I Fall - 2023 Algoma University Homework # 2 (Due: October 19, 2023) 1. The market demand for cashmere socks is given by Q = 1,000 + 0.5I – 400P + 200P’ Where, Q = Annual demand in number of pairs I = Average income I dollars per year P = Price of one pair of cashmere shocks P’ = Price of one pair of wool shocks Given that I = ECON 2106: Microeconomics I Fall - 2023 Algoma University Homework # 2 (Due: October 19, 2023) 1. The market demand for cashmere socks is given by Q = 1,000 + 0.5I – 400P + 200P’ Where, Q = Annual demand in number of pairs I = Average income I dollars per year P = Price of one pair of cashmere shocks P’ = Price of one pair of wool shocks Given that I = $20,000, P = $10, and P’ = $5, determine ƐQP, ƐQI, and ƐQP’.

Answer 2

Question

Chapter 9, Problem 1P

To determine

Concept Introduction:

Price Effect: After a change in price, each additional unit was sold at a changed price. This will result in an increase or decrease in revenue of the producer. This is known as the price effect on the revenue.

Quantity effect: After an increase or decrease in price, fewer units are sold which results in lower revenue. This is known as the quantity effect on the revenue.

Expert Solution & Answer

Explanation of Solution

a. Price and Quantity effect for BASF.

From the table, it is clear that if BASF will produce 10 more tons, then the price will fall from $4 to $3 per ton. So, with the fall in price BASF has to reduce price of each of the 40 tons.

Price effect will be:

Quality effect will be the price at which additional 10 tons were sold:

As the marginal cost is zero, additional production will not incur any extra cost on BASF, but it will incur either loss or revenue due to an increase in production; therefore it has no incentive to produce 10 tons of an additional unit.

Conclusion:

Thus, the price effect is EBK ESSENTIALS OF ECONOMICS, Chapter 9, Problem 1P , additional homework tip 3 and the quantity effect is $30.

b. Price and Quantity effect for BASF when Roche enters the market:

If BASF wants to produce 10 more tons then the price will fall from $4 to $3 per ton.

Due to the duopoly type of market, with the fall in price, BASF must reduce the price on each of the 20 tons only.

Price effect will be:

Quality effect will be the price at which an additional 10 tons were sold:

As the marginal cost is zero, the additional production will not incur any additional cost on BASF. Revenue will be increased by $10 with an increase in production.

Conclusion:

Thus, the price effect is EBK ESSENTIALS OF ECONOMICS, Chapter 9, Problem 1P , additional homework tip 6 and the quantity effect is $30.

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Answer 3

Question

Chapter 9, Problem 1P

To determine

Concept Introduction:

Price Effect: After a change in price, each additional unit was sold at a changed price. This will result in an increase or decrease in revenue of the producer. This is known as the price effect on the revenue.

Quantity effect: After an increase or decrease in price, fewer units are sold which results in lower revenue. This is known as the quantity effect on the revenue.

Expert Solution & Answer

Explanation of Solution

a. Price and Quantity effect for BASF.

From the table, it is clear that if BASF will produce 10 more tons, then the price will fall from $4 to $3 per ton. So, with the fall in price BASF has to reduce price of each of the 40 tons.

Price effect will be:

Quality effect will be the price at which additional 10 tons were sold:

As the marginal cost is zero, additional production will not incur any extra cost on BASF, but it will incur either loss or revenue due to an increase in production; therefore it has no incentive to produce 10 tons of an additional unit.

Conclusion:

Thus, the price effect is EBK ESSENTIALS OF ECONOMICS, Chapter 9, Problem 1P , additional homework tip 3 and the quantity effect is $30.

b. Price and Quantity effect for BASF when Roche enters the market:

If BASF wants to produce 10 more tons then the price will fall from $4 to $3 per ton.

Due to the duopoly type of market, with the fall in price, BASF must reduce the price on each of the 20 tons only.

Price effect will be:

Quality effect will be the price at which an additional 10 tons were sold:

As the marginal cost is zero, the additional production will not incur any additional cost on BASF. Revenue will be increased by $10 with an increase in production.

Conclusion:

Thus, the price effect is EBK ESSENTIALS OF ECONOMICS, Chapter 9, Problem 1P , additional homework tip 6 and the quantity effect is $30.

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Answer 4

Question

Chapter 9, Problem 1P

To determine

Concept Introduction:

Price Effect: After a change in price, each additional unit was sold at a changed price. This will result in an increase or decrease in revenue of the producer. This is known as the price effect on the revenue.

Quantity effect: After an increase or decrease in price, fewer units are sold which results in lower revenue. This is known as the quantity effect on the revenue.

Expert Solution & Answer

Explanation of Solution

a. Price and Quantity effect for BASF.

From the table, it is clear that if BASF will produce 10 more tons, then the price will fall from $4 to $3 per ton. So, with the fall in price BASF has to reduce price of each of the 40 tons.

Price effect will be:

Quality effect will be the price at which additional 10 tons were sold:

As the marginal cost is zero, additional production will not incur any extra cost on BASF, but it will incur either loss or revenue due to an increase in production; therefore it has no incentive to produce 10 tons of an additional unit.

Conclusion:

Thus, the price effect is EBK ESSENTIALS OF ECONOMICS, Chapter 9, Problem 1P , additional homework tip 3 and the quantity effect is $30.

b. Price and Quantity effect for BASF when Roche enters the market:

If BASF wants to produce 10 more tons then the price will fall from $4 to $3 per ton.

Due to the duopoly type of market, with the fall in price, BASF must reduce the price on each of the 20 tons only.

Price effect will be:

Quality effect will be the price at which an additional 10 tons were sold:

As the marginal cost is zero, the additional production will not incur any additional cost on BASF. Revenue will be increased by $10 with an increase in production.

Conclusion:

Thus, the price effect is EBK ESSENTIALS OF ECONOMICS, Chapter 9, Problem 1P , additional homework tip 6 and the quantity effect is $30.

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Answer 5

Chapter 9, Problem 1P

To determine

Concept Introduction:

Price Effect: After a change in price, each additional unit was sold at a changed price. This will result in an increase or decrease in revenue of the producer. This is known as the price effect on the revenue.

Quantity effect: After an increase or decrease in price, fewer units are sold which results in lower revenue. This is known as the quantity effect on the revenue.

Expert Solution & Answer

Explanation of Solution

a. Price and Quantity effect for BASF.

From the table, it is clear that if BASF will produce 10 more tons, then the price will fall from $4 to $3 per ton. So, with the fall in price BASF has to reduce price of each of the 40 tons.

Price effect will be:

Quality effect will be the price at which additional 10 tons were sold:

As the marginal cost is zero, additional production will not incur any extra cost on BASF, but it will incur either loss or revenue due to an increase in production; therefore it has no incentive to produce 10 tons of an additional unit.

Conclusion:

Thus, the price effect is EBK ESSENTIALS OF ECONOMICS, Chapter 9, Problem 1P , additional homework tip 3 and the quantity effect is $30.

b. Price and Quantity effect for BASF when Roche enters the market:

If BASF wants to produce 10 more tons then the price will fall from $4 to $3 per ton.

Due to the duopoly type of market, with the fall in price, BASF must reduce the price on each of the 20 tons only.

Price effect will be:

Quality effect will be the price at which an additional 10 tons were sold:

As the marginal cost is zero, the additional production will not incur any additional cost on BASF. Revenue will be increased by $10 with an increase in production.

Conclusion:

Thus, the price effect is EBK ESSENTIALS OF ECONOMICS, Chapter 9, Problem 1P , additional homework tip 6 and the quantity effect is $30.

Answer 6

Chapter 9, Problem 1P

To determine

Concept Introduction:

Price Effect: After a change in price, each additional unit was sold at a changed price. This will result in an increase or decrease in revenue of the producer. This is known as the price effect on the revenue.

Quantity effect: After an increase or decrease in price, fewer units are sold which results in lower revenue. This is known as the quantity effect on the revenue.

Expert Solution & Answer

Explanation of Solution

a. Price and Quantity effect for BASF.

From the table, it is clear that if BASF will produce 10 more tons, then the price will fall from $4 to $3 per ton. So, with the fall in price BASF has to reduce price of each of the 40 tons.

Price effect will be:

Quality effect will be the price at which additional 10 tons were sold:

As the marginal cost is zero, additional production will not incur any extra cost on BASF, but it will incur either loss or revenue due to an increase in production; therefore it has no incentive to produce 10 tons of an additional unit.

Conclusion:

Thus, the price effect is EBK ESSENTIALS OF ECONOMICS, Chapter 9, Problem 1P , additional homework tip 3 and the quantity effect is $30.

b. Price and Quantity effect for BASF when Roche enters the market:

If BASF wants to produce 10 more tons then the price will fall from $4 to $3 per ton.

Due to the duopoly type of market, with the fall in price, BASF must reduce the price on each of the 20 tons only.

Price effect will be:

Quality effect will be the price at which an additional 10 tons were sold:

As the marginal cost is zero, the additional production will not incur any additional cost on BASF. Revenue will be increased by $10 with an increase in production.

Conclusion:

Thus, the price effect is EBK ESSENTIALS OF ECONOMICS, Chapter 9, Problem 1P , additional homework tip 6 and the quantity effect is $30.

Answer 7

Chapter 9, Problem 1P

To determine

Concept Introduction:

Price Effect: After a change in price, each additional unit was sold at a changed price. This will result in an increase or decrease in revenue of the producer. This is known as the price effect on the revenue.

Quantity effect: After an increase or decrease in price, fewer units are sold which results in lower revenue. This is known as the quantity effect on the revenue.

Answer 8

Expert Solution & Answer

Explanation of Solution

a. Price and Quantity effect for BASF.

From the table, it is clear that if BASF will produce 10 more tons, then the price will fall from $4 to $3 per ton. So, with the fall in price BASF has to reduce price of each of the 40 tons.

Price effect will be:

Quality effect will be the price at which additional 10 tons were sold:

As the marginal cost is zero, additional production will not incur any extra cost on BASF, but it will incur either loss or revenue due to an increase in production; therefore it has no incentive to produce 10 tons of an additional unit.

Conclusion:

Thus, the price effect is EBK ESSENTIALS OF ECONOMICS, Chapter 9, Problem 1P , additional homework tip 3 and the quantity effect is $30.

b. Price and Quantity effect for BASF when Roche enters the market:

If BASF wants to produce 10 more tons then the price will fall from $4 to $3 per ton.

Due to the duopoly type of market, with the fall in price, BASF must reduce the price on each of the 20 tons only.

Price effect will be:

Quality effect will be the price at which an additional 10 tons were sold:

As the marginal cost is zero, the additional production will not incur any additional cost on BASF. Revenue will be increased by $10 with an increase in production.

Conclusion:

Thus, the price effect is EBK ESSENTIALS OF ECONOMICS, Chapter 9, Problem 1P , additional homework tip 6 and the quantity effect is $30.