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General Equilibrium

Finding consumer surplus and Govt's revenue

1. If Q=460-4P, What is consumer surplus when P=$35 & $25 respectively? what happens to consumer surplus when price of a good decreases? 2. If Qs= 0.25P-0.5 and Qd=7-0.5P Suppose a $6/unit excise tax is imposed on the good, what is the new equilibrium price and how much revenue does the govt receive from this tax?

Market Concepts

You want to start a company, and are trying to decide between two different industries. You are doing your final research before you write your business plan. Industry A has 20 firms and a Concentration Ratio (CR) of 30% - What is the name for this type of industry? - Describe some of this industry's characteristics. - I

Managerial Economics

There is an increase in the cost of labor for producing bicycles. What happens to bicycle supply? What happens to bicycle demand? Digital cameras and memory cards are complements in consumption. The price of digital cameras falls. What happens to the demand for memory cards? What happens to the demand for digital cam

Perfect competition

Discuss perfect competition and long-run equilibrium. Provide detailed descriptions, definitions and concrete examples of your findings. Additionally, how does the proliferation of global trade and competition contribute to markets moving more away from market-possessing power to more perfect competition? Lastly, when does margi

Complete the Supply and Demand Simulation

Address the following: What causes the changes in supply and demand in the simulation? How do shifts in supply and demand affect your decision making? List four key points from the assignments emphasized in the simulation. How may you apply what you learned about supply and demand from the simulation to your workpla

This is a Managerial Economic Question

A recent report indicatesthat nearly 50 Americans contract HIV each year through blood transfusions.Although every pint of blood donated in the United States undergoes a batteryof nine different tests, existing screening methods can detect only the antibodiesproduced by the b0dyâ??s immune systemâ?"not foreign agents in the bl

Managerial Economics

Florida Citrus Mutual, an agricultural cooperative association for citrus growers in Florida, needs to predict what will happen to the price and output of Florida oranges under the conditions below. What are your predictions? For each part, sketch a graph showing the appropriate demand and supply analysis. a. A major freeze

Supply and Demand Graph

Consider a market characterized by the following demand and supply conditions: Demand: Px = 50 - 5QX Supply: Px = 32 + QX. Graph the demand and the supply. Label the axis and the equilibrium. The equilibrium price and quantity are, respectively? Looking on how to graph this.

IS Curve - the influence of interest rates

Using the same simple model of the economy, now allow for the impact of interest rates on consumption. The consumption function is: Y=120+0.7Y-10r where r is the level of interest rates. Calculate the equilibrium level of income when interest rates are 1, 2, 3, 4, 5, 6, 7, 8, 9 and 10% Draw the resulting IS curve.

Monopoly Price-Output Decision

Calvins's Barber Shops, Inc., has a monopoly on barbershop services provided in the south side of Chicago because of restrictive licensing requirements, and not because of superior operating efficiency. As as monopoly, Calvin's provides all industry output.. For simplicity, assume that Calvins's operates a chain of barbershops a

Product markets

3. Assume the following cost data are the purely competitive producer: Total product Avg. Fixed Avg. Variable Avg. Total Marginal Product Cost ($) Cost ($) Cost ($) Cost ($) 0

ECONOMIC ENVIRONMENT OF BUSINESS

1. What are the three tools the Federal Reserve uses to change the money supply and interest rates in the economy? Which of these tools is most important and why? 2. In each of the following cases, explain whether the statements are true or false, and why: a. If the real money demand is greater than the real money supply, in

Price Matching and Nash Equilibrium

** Please see the attached file for the complete solution response ** Textbook: Thomas and Maurice, Managerial Economics,9th ed., McGraw-Hill , ISBN 9780073402819 Q1: Suppose the two rival office supply companies Office Depot and Staples both adopt price matching policies. If consumers can find lower advertised prices

Measuring Macroeconomic Activity

1. Some games of strategy are cooperative. One example is deciding which side of the road to drive on. It doesnâ??t matter which side it is as long as everyone chooses the same side. Otherwise, everyone may get hurt. Driver 2 Le

Question about a profit-maximizing firm

A profit-maximizing firm in a competitive market is currently producing 1000 units of output. It has average revenue of $10, average total cost of $8, and fixed costs of $200. a. What is profit? b. What is marginal cost? c. What is variable cost? d. If you are operating a business in a perfect competitive market, why woul

Microeconomics Problem Set

1. Some games of strategy are cooperative. One example is deciding which side of the road to drive on. If doesn't matter which side it is as long as everyone chooses the same side. Otherwise, everyone may get hurt. a. Does either player have a dominant strategy? Explain. b. Is there a Nash equilibrium in the game? Explain.

Monopoloy equilibrium and marginal revenues

Demand: Q=90-P/2 so that Marginal Revenue is MR=180-4Q. Total cost: TC=20Q+1000 so that Marginal Cost is MC=20. Q P=D MR MC ATC P* 45 44 43 42 41 40 39 38 37 36 35 Draw the monopoly equilibrium: pl

Managerial Economics

The market demand schedule for noodles is as follows: Price ($ per case) Q Demanded (case per week) 5.40 50,200 6.40 45,200 7.40 40,000 8.40 35,000 9.40

incidence of the tax

Assume that the demand function is given by x=P^-n, and the supply function by y= p^e. Find the equilibrium price. Determine the effect on the equilibrium price of the introduction of a tax t=0.1 if n= e=0.5. Finally, describe how the incidence of the tax is divided between the consumers and producers.

Simultaneous equilibrium conditions in the money & goods market

2(a) Derive the expression for the IS schedule Y = C + I + G in the form i = f(Y), when C = 130 + 0.3Y, I = 100 - 35i, and G = 50. (b) Calculate the interest rate when the equilibrium level of income is 100 and 300. (c) Derive the expression for the LM schedule in the form i = f(Y), when the money demand function is Md =

Equilibrium condition in the money market

1(a) Given the national income model Y = C + I + G where C = 100 + 0.75Y, I = 120 - 20i, G= 80, derive an expression for equilibrium in the goods market in the form i = f(Y). (b) Given the money demand function, MD = 600 + 0.4Y - 40i, and supply function, MS = 900, derive an expression for equilibrium in the money market in

Supply & Demand Problems

I need to answer the following (...stating the curves so that the quantity demanded and quantity supplied are both functions of price, putting price on the horizontal axis. There is more than one demand curve, but all have a slope of -5. Also there is more than one supply curve, but all have a slope of +4.) a) The demand

Substitute good decreases in a long-run competitive equilibrium

Suppose that a competitive industry is in a long-­â?run competitive equilibrium. Then the price of a  substitute good (in consumption) decreases.  What will happen in the short run to:   a. The market supply and demand curves   b. Market  price   c. Market  output   d. The firm's output e. The firm's

Finding optimal output level

Please refer attached file for graph. Answer the following questions on the basis of the monopolist's situation illustrated in the following graph. a.At what output rate and price does the monopolist operate? b.In equilibrium, approximately what is the firm's total cost and total revenue? c.What is the firm's economic pr

Simple model of duopoly

In a simple model of duopoly, two firms produce the same good, for which each firm charges either a low or a high price. Each firm wants to achieve the highest profits. The following matrix shows strategies and payoffs for both firms that must decide how to price. Firm B High Low Firm A High 1000, 1000 -200, 1200

Monopoly

A monopoly market is characterized by the following Market Demand and Market Total Cost. Demand: QD = 20.25 â?" 0.5 * P Total Cost: TC = 242 + 35*QS â?" 9*QS2 + 0.5*QS3 Determine the equilibrium price and quantity that will obtain in the long run.

Dominant Strategy and Nash Equilibrium

Suppose that two players are playing the following game. Player A can choose either Top or Bottom, and Player B can choose either Left or Right. The payoffs are given in the following table: Player B Player A Left Right Top 2 5 1

4 questions.

Having difficulty with these questions. 1. A major cereal manufacturer decides to lower prices from $3.60 to $3.00 per 15-ounce box. If quantity demanded increases by 18%, calculate the price elasticity of demand? Is this an example of elastic or inelastic demand? 2. To increase state tax revenues, the Governor of Californ