integrated programme in management, Microeconomics

1. Suppose we observe that the price of soyabeans goes up while the quantity of soyabeans sold goes up as well. Use the supply and demand curves to illustrate two possible explanations for this pattern of price and quantity changes.

2. Explain why the price elasticity of demand for a product such as 'yogurt' is likely to be less negative than the price elasticity of demand for an 'Amul yogurt'.

3. Chinese checkers (CC, a board game) are produced and sold in a competitive market. When there is no tax on the product, the equilibrium price is Rs. 100 per CC. The point elasticity of demand is about -0.9 and the point elasticity of supply is about 1.2. In commenting on a proposed excise tax of Rs. 10 per CC, a newspaper article states that "The tax will probably drive the price of a CC up by Rs. 10". Is this a reasonable conclusion? Explain.

4. Natasha usually pays a price between 5 rupees and 7 rupees per ice cream. Over this range of prices, her weekly total expenditure on ice cream increases as the price decreases. What does this imply about Natasha's price elasticity of demand for ice cream? Explain.

5. A consumer has Rs.50 per week to spend on either commodity X, whose price is Rs.5, or commodity Y, whose price is Rs.4. For each of the four cases below, indicate whether or not this consumer is "at equilibrium," i.e., deriving the maximum-attainable satisfaction by spending all of his/her income. If you lack sufficient information to answer, explain why. If you know the consumer is not at equilibrium, indicate the required direction of movement (e.g., "buy more of X and less of Y," "buy less of X and more of Y," "buy more of both," etc.):

a. Purchases are now 2 of X and 10 of Y. Total utility of X at this level is 500 utils; total utility of Y is 400 utils

b. Purchases are now 6 of X and 5 of Y. Total utility of X at this level is 400 utils, and the marginal utility of X is 60 utils. Total utility of Y is 800 utils, and the MU of Y is 30 utils.

c. Purchases are now 6 of X and 5 of Y. The MU of X at this level is 25 utils; the MU of Y is 20 utils.

d. Purchases are now 6 of X and 4 of Y. The MU of X at this level is 25 utils; the MU of Y is 20 utils.

Posted Date: 2/22/2013 2:02:52 AM | Location : United States







Related Discussions:- integrated programme in management, Assignment Help, Ask Question on integrated programme in management, Get Answer, Expert's Help, integrated programme in management Discussions

Write discussion on integrated programme in management
Your posts are moderated
Related Questions
Profits University creates student credit hours (y) with two inputs: Professors' hours of work (x1) and TAs' hours of work (x2) according to the manufacture function: f(x1,x2)= 10x

Changes in Market Equilibrium Equilibrium prices are known by the associate level of supply and demand. Supply and demand are decided by particular values of supply & demand


Money market, labour market, goods market

Globalization: A generalized historical process by which more economic activity occurs across national borders. Forms of globalization include international trade (imports and expo

Are there any economic effects to non-Hispanic whites, given that they no longer represent the majority of the population? Why are these examples important from an economic standpo

Fluctuations in Growth Rates: Fluctuations in year-to-year growth rates in early stages were very marked, which indicated that the economy had failed to create conditions cond

given the cost function as C=0.3Q3-2Q2+13Q+25,find the supply function


Consider 2 firms i=1,2 producing quantities q1 and q2 respectively. Let the market price be given by P=a-b(q1+q2). Firm 1''s Marginal cost c is common knowledge but 2''s cost is no