Question

QUESTION 13 costs. Accounting profits are equal to total revenues minus Implicit Explicit Explicit and Implicit Total QUESTION 14 The equilibrium price and quantity of a good are found where the supply and demand curves intersect. True False

Answer 1

Answer 13 - Explicit cost

Reason - Accounting profit is equal to total revenue minus explicit costs. Explicit costs are costs which are actually paid in cash out of pocket.

Answer 14 - True

Reason - equilibrium is the state of balance. It is the point where demand and supply are exactly equal and such quantity is called equilibrium quantity and the price at which such quantity is sold is called equilibrium price.

Answer 16 - Inelastic

Reason - price elasticity of demand is said to be inelastic when it is less than one. It is a situation where the elasticity of demand is less than the elasticity of price. The daily essentials of consumption like household needs are a good example of it.

Answer 17 - False

Reason - A perfectly competitive firm can never set the price as there are number of buyers and sellers in the market and the price is determined by the buying and selling forces in the market. A perfectly competitive firm can only produce as much as quantity it wants at a price which is predetermined by the market.

Answer - Between 3 and 3.5

Reason -

Q 18. Here, Initial price . QH 9 is units Qa P: Changed price & Initial quantity Changed quantity change (atherence) & price elasticity of demand 20 wits A : formula X 요 QI AP 10 QUI - MI P- PI Х گا 20-15 x 10 15 10 - 9 -la X ala SO so 3.33