What is the nature of goods and relationship

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Question 1. A cut in price from Br.1.50 to Br.1.20 leads demand for a product rise by 10%. What would the price elasticity of demand be for this product? Interpret the result by identifying the type of good?

Question 2. Fraol's income elasticity for good A is equal to -1.5. His current income is Br.40, 000 per year and he buys 200 units of good A annually. If his income falls to Br.36, 000 how many units of good A will he purchase?

Question 3. The demand for petrol rises from 500 to 600 Barrels when the price of a particular scooter is reduced from birr 25000 to birr.22000. Find out the cross elasticity of demand for the two. What is the nature of goods and relationship?

Question 4. Managerial economist estimates the price quantity relationship for Textile Company to be p= 40-4q

a. At what output rate demand is unitary elastic?

b. Over what range of output demand is elastic? c. Over what ranges of output of demand is inelastic?

Question 5. Consider the following short run production function of a textile manufacturing: Q ? 6L2 ? 0.4L 3

a) Find the value of L that maximizes output of textile

b) Find the value of L that maximizes average product

Question 6. Given the following data X (consumers of teff) or popn 3 6 8 1 13 13 14 Y ( teff consumption) 8 6 10 12 12 14 20 year 2013 2014 2015 2016 2017 2018 2019

A. Estimate the regression equation, Y= a+bX, Where Y denotes demand for teff while X is consumers of teff (population)

B. By assuming demand for teff is only affected by its consumers, find the amount demand for teff in the year 2022 if the populations (consumers of teff) are about 18 people?

Reference no: EM132744768

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