a) i)Explain difference between; ii,Microeconomics and macroeconomics iiiPositive and Normative economics b) Given the following demand and supply functions as; i)Find the price elasticity of demand and price elasticity of supply at the equilibrium point. ii)Based on the values obtained from Price elasticity of supply in (i) above, what advice would you give to the producer if he is to increase revenue? iv)Using illustrations, distinguish between Minimum and maximum price v)Assuming the government, set the price at 45shs, determine whether its minimum or maximum price, and state the surplus or deficit
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a) i)Explain difference between;
ii,
iiiPositive and Normative economics
b) Given the following
i)Find the price
ii)Based on the values obtained from Price elasticity of supply in (i) above, what advice would you give to the producer if he is to increase revenue?
iv)Using illustrations, distinguish between Minimum and maximum price
v)Assuming the government, set the price at 45shs, determine whether its minimum or maximum price, and state the surplus or deficit
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- 1.You have been recently employed as a consultant for a company that produces laptops in Ghana. Suppose the research department of the company have estimated the demand and supply curves of laptops and they are:2Qd + 0.5P − 24 = 0and 4Qs − 2P + 6 = 0You are to use this information toa. Determine the equilibrium level of prices and quantity demand.b. Represent your answer graphically and determine the welfare of economic agents.c. Suppose the government imposes a tax of ¢4 on every laptop sold, determine the new equilibrium price and quantity.d. Represent the new supply curve, old supply curve and the demand curve on a graph showing all equilibria.e. Show how the economic agents share the tax.f. What is the amount of government tax revenue?Demand, Supply, and Market Equilibrium - Think of a product that you have purchased recently (e.g. soda, diapers, takeout meals, milk, shoes, manicure/pedicure, video game, etc...). Explain how the law of demand affected your purchase. Give specific examples of how the determinants of demand and supply affect this product (T-I-P-E-N and P-R-E-S-T). What happens to the demand curve and the supply curve when any of these determinants change? What would cause a change in demand versus a movement along the same demand curve for this product? How would you determine the new equilibrium price and quantity that result from these changes? Can you demonstrate some of these changes graphically? Price Elasticity of Demand - Consider a product that you have purchased recently. If the price of this item increases, how would you adjust your purchases? Is the Demand for this product Price Elastic or Price Inelastic? Justify your classification by applying the determinants of elasticity to…Suppose government has been able to reduce the level of tobacco consumption in the country through a social campaign. a) Properly labeling the axes, draw a figure showing the current supply of and demand for tobacco and equilibrium price and quantity demanded and supplied. b) Provide a brief explanation about new equilibrium price
- This problem involves solving demand and supply equations together to determine price and quantity. a. Consider a demand curve of the form QD=-2P+20, where QD is the quantity demanded of a good and P is the price of the good. Graph this demand curve. Also draw a graph of the supply curve Qs =2P-4, where Qs is the quantity supplied. Be sure to put P on the vertical axis and Q on the horizontal axis. Assume that all the Qs and Ps are nonnegative for parts a, b, and c. At what values of P and Q do these curves intersect-that is, where does QD = Qs ? b. Now, suppose at each price that individuals demand four more units of output-that the demand curve shifts to QD - 2P+24. Graph this new demand curve. At what values of P and Q does the new demand curve intersect the old supply curve-that is, where does QD = Qs ? c. Now finally, suppose the supply curve shifts to Q's=2P-8. Graph this new supply curve. At what values of P and Q does QD=Q's? Show all working calculations and label garph with…3)What is the relationship between a demand schedule and a demand curve? * a)A demand schedule shows the various quantities of the good demanded, while a demand curve shows the various prices. b)A demand schedule is a numerical tabulation of the quantity demanded of a good at different prices, while a demand curve is a graphical representation of the law of demand. c)A demand curve shows the various quantities of the good demanded, while a demand schedule shows the various prices. d)A demand curve is a numerical tabulation of the quantity demanded of a good at different prices, while a demand schedule is a graphical representation of the law of demand.6. The Market for Chicken Meat in Davao City a. Fill in the missing algebraic signs ( + or -) of the demand and supply equations for chicken meat below according to the hypothesized direction of relationships. where: Q= quantity of chicken meat in kilograms, per day Pc = price of chicken meat (in pesos per kilogram) 1= income of average consumer (in pesos per day) P=price of beef (in pesos per kilogram) W=wage rate paid in the poultry business (in pesos per day) P,= price of mixed feeds (in pesos per kilogram) Demand: Q = 20. Supply: Q = - 20 1.5P 4.5Pc _0.8 I _0.5 W _0.6 Ps 3 PF b. Suppose the other variable affecting the demand for and supply of chicken meat have the following values: I = P300/day; Pa = P100/kg; W = P100/day; Pr = P10/kg i. Derive the simple demand and supply equations where Q is a function of P. ii. Solve for the equilibrium price and quantity in the market. iii. Suppose the government imposes a price ceiling of P50/kg: 1. What happens to the market for chicken? 2.…
- es The graph below shows the market for oats. Price per bushel 12 11 10 9 8 10 432 S 4 0 10 50 70 100¹10120 30 90 80 60 40 20 Quantity per period (in millions of bushels) S Tools Sz Prev 4 of 8 # Next >1. The weekly demand (Qd) and supply (Qs) functions for a good X are given by:-Qd = 1000 – 5pQs = -400 + 15p, where P = Price per unit (R)(i) Draw the demand and supply curves on a graph and find the equilibrium priceand quantity (ii) If the demand function changes to 1200 – 5P, show the changes to part (i)above. (iii) Suppose a subsidy of R40 per unit is subsequently granted to producers ofgood X. Determine the new equilibrium price and quantity. (b) Use suitable examples to explain the likely effects of a price ceiling. (c) What do you understand by the ‘Substitution and Income effects’ of a change inprice of a good. (d) Elaborate on the factors influencing Price Elasticity of Demand (PED) and PriceElasticity of Supply (PES) of a good. 2. (a) Explain the concepts of Price Elasticity of Demand (PED), IncomeElasticity of Demand (YED) and Cross Elasticity of Demand (CED)(b) To what extent can PED be important to:-(i) a government, (ii) managers of hypermarkets ‘3. (a) Compare the…I. For the normal good, make a (Hypothetical) linear demand schedule with 7 different price points and corresponding quantity demanded for your own household. For the same normal good, make another (Hypothetical) linear demand schedule with 7 different price points and corresponding quantity demanded for your neighbor. Assuming that you and your neighbor are the only two households in the market, make a market demand schedule for the same normal good. Draw and interpret a graph to show the market demand and impact of changes in quantity demanded, if price of the same normal good decreases.
- What are the potential effects in the market for a college education if the number of colleges offering degrees increases. a) draw a supply/demand graph of the market for college education. b) indicate starting equilibrium price and equilibrium quantity. c) Analyze graphically the effect of the change given above on equilibrium price and equilibrium quantity in the automobile market.Draw the supply-and-demand diagrams for market X in each of the following scenarios (separate graph for each scenario.) Then use your diagrams to illustrate the impact of the following events, ceteris paribus. In each case, determine what happens to price and quantity in the market for X. (You must properly label ALL initial & subsequent: axes, curves, prices, quantities, and equilibriums.) a) X and Y are substitutes, and the price of good Y increases. b) X and Y are a typically used in conjunction, and there is a shift in tastes away from another good Z and toward Y. c) X is an inferior good, and incomes in the community decreases. d) There is a technological advance in the production of good X. e) Y is an input used to produce good X, and dire international political events disrupt availability of Y. Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.Ethanol, a fuel, is made from corn. Ethanol production increased 5.5 times from 2000 to 2008 and another 34% from 2008 to February 2013 (www.ethanolrfa.org). What effect did this increased use of corn for producing ethanol have on the price of corn and the consumption of corn as food? 1.) Use the line drawing tool to draw either a new demand curve (D2) or a new supply curve (S,) that shows how the increased use of corn for producing ethanol affects the market for corn as food, Properly label this line. 2.) Use the point drawing tool to indicate the new market equilibrium. Label this point 'e2'. Carefully follow the instructions above, and only draw the required objects. What happens to the equilibrium price and equilibrium quantity of corn as food? In the market for corn as food, the equilibrium price V and the D1 Q1 equilibrium quantity Q, quantity of corn as food ... $. price of corn