Homework Answers
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Price elasticity measures the responsiveness of the quantity demanded or supplied of a good to a change in its price. It is computed as the percentage change in quantity demanded—or supplied—divided by the percentage change in price.
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Elasticity can be described as elastic—or very responsive—unit elastic, or inelastic—not very responsive.
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Elastic demand or supply curves indicate that the quantity demanded or supplied responds to price changes in a greater than proportional manner.
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An inelastic demand or supply curve is one where a given percentage change in price will cause a smaller percentage change in quantity demanded or supplied.
As in today's scenario , bottled water has become the real more demandable good.In such senario , if the price of water bottle will rise , quantity will rise more than change in price . Because without water no one is able to live .So quantity will rise , more than price. Hence demand is elastic or it can may be perfect eleastic, as percentage change in demand will definately rise if there is nor change in percentage of price .
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Question 7 (2 points) Given the current economic situation created by the pandemic, would you assume...
1. Due to current economic turmoil created by the Corona virus pandemic, China's economy is expected...
1. Due to current economic turmoil created by the Corona virus pandemic, China's economy is expected to grow by 1.2 percent this year, down from 6pc growth, on weak exports and losses in domestic activity due to social distancing steps, according to International Monetary Fund's (IMF) January forecast. The world's second-largest economy is expected to see a rebound in activity later this year, with growth to bounce back to 9.2pc next year, the IMF said. There were risks even to...
Question #4: Price Elasticity of Demand [14 Points]Suppose that the demand function for crab cakes is...
Question #4: Price Elasticity of Demand [14 Points]Suppose that the demand function for crab cakes is equal to 1200−=PQD(a) Using calculus calculate the price elasticity of demand when P = $20. [8 Points] (b) Is demand for crab cakes elastic, unit-elastic, or inelastic? Briefly explain [2 Points] (c) By how much should producers cut the price in order to sell 25% more crab cakes? Question #5: Elasticity [22 Points] Consider the market for an Italian cookbook. Demand for the Italian...
2. (20 points) For each of the following pairs of goods, identify which one you would...
2. (20 points) For each of the following pairs of goods, identify which one you would expect to have more own-price elastic demand. Please explain your reasoning. (a) (5 points) Computers (generally) vs. Apple MacBook Pro laptops. (b) (5 points) Stereo headphones (generally) vs. hearing aids. For each of the following goods, identify whether you would expect demand to be more (own- price) elastic in the short run or the long run. As above, please briefly explain your reasoning. (c)...
Question 2: Elasticity and Price (8 points) $25.00 $20.00 b $15.00 $10.00 $5.00 500 S50 600...
Question 2: Elasticity and Price (8 points) $25.00 $20.00 b $15.00 $10.00 $5.00 500 S50 600 650 700 Quantity Demanded Is the demand for this product Elastic or Inelastic between points "a" and "b"? the product sells for somewhere between $15.00 and $20.00. you were the producer, would you raise your price, lower it, or keep it the same? ity and some specific numbers. Please show how you got your answer. Now If Please explain using the concept of Elastic-...
QUESTION 8 Jen is the only seller of bottled water at the Brisbane Entertainment Centre, There...
QUESTION 8 Jen is the only seller of bottled water at the Brisbane Entertainment Centre, There are no close substitutes available. Patrons are not allowed to bring any form of bottled water to the venue, Select the item from the list provided to make the following statements true: The extent of the deadweight 1. Supply loss created by Jen's monopoly depends on her ability to set 3. Economic profits price. This is also referred to as 4. Marginal revenue 2....
QUESTION 3: KEYNESIAN MODEL (7 POINTS) (You must show all steps of your calculations to get...
QUESTION 3: KEYNESIAN MODEL (7 POINTS)
(You must show all steps of your calculations to get credit
for each item of this question; otherwise, you will be deducted
marks)
ANSWER THE FOLLOWING QUESTIONS BASED ON THE KEYNESIAN
ECONOMY DESCRIBED IN THE TABLE BELOW. ALL FIGURES ARE IN $
BILLIONS.
(2 points) A. Fill in the blanks in this table, making
the usual assumptions presented in the Keynesian theory (Chapter
9). All figures are in $ billions.
(1 point) B. Calculate...
Please help me in both questions, thank you very much :) QUESTION 6 According to the...
Please help me in both questions, thank you very much :)
QUESTION 6 According to the Herald Sun Newspaper, a study by the Centre for International Finance found that Australian monopolies perform better compared to monopolies elsewhere. Surprisingly, the research found that companies with monopoly power in Australia were three times more likely to invest in research and development than companies in competitive markets Which of the following are valid explanations for the existence of monopolies? 1. They have exclusive...
Question 6 (5 points) Tax laws affect Question 6 options: A) economic efficiency but not equity....
Question 6 (5 points) Tax laws affect Question 6 options: A) economic efficiency but not equity. B) consumption and production, not efficiency and equity. C) equity but not economic efficiency. D) both efficiency and equity. Question 7 (5 points) Suppose the government imposes an 8 percent sales tax on clothing items and the tax is levied on sellers. Who pays for the tax in this situation? (Assume that the demand curve is downward-sloping and that the supply curve is upward-sloping.)...
es lo 514. What is the news and Od? What type of disequilibrium situation exists, and...
es lo 514. What is the news and Od? What type of disequilibrium situation exists, and what is its maumitude Briefly describe what will happen to bring the market back to equilibrium. 2) Price Elasticity of Demand (5 points) When the price of Java Joe's lattes decreased from $5.00 to $4.50, the quantity of lattes sold increased from 30 to 40 lattes per day. a Calculate the price elasticity of demand for Java Joe's lattes. b. Interpret this result: is...
2. The diagram below shows the current macroeconomic situation for the economy of Ukraine (LRAS stands...
2. The diagram below shows the current macroeconomic situation for the economy of Ukraine (LRAS stands for Long-Run Aggregate Supply, SRAS stands for Short Run Aggregate Supply and AD for Aggregate Demand. You have been hired as an economic consultant to help the economy move to potential output, Y 0 LRAS SRAS AD Output, y a. Is Ukraine facing a recessionary or inflationary gap? Briefly explain b. Which type of fiscal policy expansionary or contractionary would move the economy of...
1. Due to current economic turmoil created by the Corona virus pandemic, China's economy is expected to grow by 1.2 percent this year, down from 6pc growth, on weak exports and losses in domestic activity due to social distancing steps, according to International Monetary Fund's (IMF) January forecast. The world's second-largest economy is expected to see a rebound in activity later this year, with growth to bounce back to 9.2pc next year, the IMF said. There were risks even to...
2. (20 points) For each of the following pairs of goods, identify which one you would expect to have more own-price elastic demand. Please explain your reasoning. (a) (5 points) Computers (generally) vs. Apple MacBook Pro laptops. (b) (5 points) Stereo headphones (generally) vs. hearing aids. For each of the following goods, identify whether you would expect demand to be more (own- price) elastic in the short run or the long run. As above, please briefly explain your reasoning. (c)...
Question 2: Elasticity and Price (8 points) $25.00 $20.00 b $15.00 $10.00 $5.00 500 S50 600 650 700 Quantity Demanded Is the demand for this product Elastic or Inelastic between points "a" and "b"? the product sells for somewhere between $15.00 and $20.00. you were the producer, would you raise your price, lower it, or keep it the same? ity and some specific numbers. Please show how you got your answer. Now If Please explain using the concept of Elastic-...
QUESTION 8 Jen is the only seller of bottled water at the Brisbane Entertainment Centre, There are no close substitutes available. Patrons are not allowed to bring any form of bottled water to the venue, Select the item from the list provided to make the following statements true: The extent of the deadweight 1. Supply loss created by Jen's monopoly depends on her ability to set 3. Economic profits price. This is also referred to as 4. Marginal revenue 2....
QUESTION 3: KEYNESIAN MODEL (7 POINTS)
(You must show all steps of your calculations to get credit
for each item of this question; otherwise, you will be deducted
marks)
ANSWER THE FOLLOWING QUESTIONS BASED ON THE KEYNESIAN
ECONOMY DESCRIBED IN THE TABLE BELOW. ALL FIGURES ARE IN $
BILLIONS.
(2 points) A. Fill in the blanks in this table, making
the usual assumptions presented in the Keynesian theory (Chapter
9). All figures are in $ billions.
(1 point) B. Calculate...
Please help me in both questions, thank you very much :)
QUESTION 6 According to the Herald Sun Newspaper, a study by the Centre for International Finance found that Australian monopolies perform better compared to monopolies elsewhere. Surprisingly, the research found that companies with monopoly power in Australia were three times more likely to invest in research and development than companies in competitive markets Which of the following are valid explanations for the existence of monopolies? 1. They have exclusive...
es lo 514. What is the news and Od? What type of disequilibrium situation exists, and what is its maumitude Briefly describe what will happen to bring the market back to equilibrium. 2) Price Elasticity of Demand (5 points) When the price of Java Joe's lattes decreased from $5.00 to $4.50, the quantity of lattes sold increased from 30 to 40 lattes per day. a Calculate the price elasticity of demand for Java Joe's lattes. b. Interpret this result: is...
2. The diagram below shows the current macroeconomic situation for the economy of Ukraine (LRAS stands for Long-Run Aggregate Supply, SRAS stands for Short Run Aggregate Supply and AD for Aggregate Demand. You have been hired as an economic consultant to help the economy move to potential output, Y 0 LRAS SRAS AD Output, y a. Is Ukraine facing a recessionary or inflationary gap? Briefly explain b. Which type of fiscal policy expansionary or contractionary would move the economy of...
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