Summer2011-Microeconomics-Exam Two Practice 1. To calculate the total utility of consuming N products: A. add the additional satisfaction of consuming each product up to N and multiply by its price. B. add the total satisfactions of consuming each product up to N. C. multiply the additional satisfaction from consuming the Nth product by its price. D. multiply total satisfaction from consuming N products by N. 2. Suppose that the following table lists the utility that Steve receives from consuming oranges at 50
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Demand‚ Supply and Market Price Determination Consumer behaviour Utility is the economist’s term for the satisfaction a customer derives from the goods that they buy. Marginal utility is the increase in total utility arising from an increase in consumption by one more. For example‚ suppose I like eating bananas‚ and I have already eaten one banana; then the satisfaction I get from consuming a second banana is called by economists the marginal utility. Marginal utility is the utility gain from
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Elasticity of Labour Demand A firm always incurs a change in labour or capital. It is important for a firm to know the effects on the wage or capital increase since it would help the firm make accurate decisions. A change in wage would make an impact on the firms employment. When there is a wage cut‚ it reduces the price of labour relative to that of capital‚ and now labour is cheaper. However‚ when the wage increase the price of labour increases and the firm would substitute away from labour toward
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1. A government is proposing to increase the tax on petrol. Examine the relevance of price elasticity of demand for this proposal. When considering increase the tax on petrol‚ there are a few things to look at. First of all‚ the price elasticity of demand is a measure of responsiveness of the quantity of a good or service demanded to change in its price. Petrol is an inelastic product. This is because petrol is a needed in a daily basis. An increase in price of petrol will cause a small change
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b. Calculate elasticity of demand for Californians for a reduction in price? Formula of elasticity of demand with reference to price a. 18 to 16 Price elasticity of demand = %change in quantity demanded % change in price = (10‚000 – 14‚000) x 100 (18 – 16) = (-4000) x 100 (2) = -2000 /100 = -20 b. 16 to 14 Price elasticity of demand = %change in quantity
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29114583 Change in Demand and Supply and Coffee Prices Theoretical Basis Law of demand The negative relationship between price and quantity demanded: As price rises‚ quantity demanded decreases; as price falls‚ quantity demanded increases. Demand Curve A graph illustrating how much of a given product a household would be willing to buy at different prices. Law of supply The positive relationship between price and quantity of a good supplied: An increase in market price will lead to an increase
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Price / Earnings Ratio Q1: (Introductory) What three alternative measures of the price-earnings ratio (P/E ratio) are described in this article? Answer: Following are three price-earnings ratio described in the article: 1. P/E ratio 2. “Forward” P/E ratio 3. “Trailing” P/E ration Q2: (Advanced) Which of the three measures matches the definition of the P/E ratio given in your textbook? Explain your answer. Answer: Books has only discuss the simple P/E ratio‚ PE ratio measures how much investor
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mind with his credo about family‚ “You got to learn to stick to your own blood or you ain’t going to have any blood to stick to you” (Faulkner 3). This so called credo drafts the conflict that is prowling around the young boy’s brain and constantly raises this question: What about the concept of right and wrong? In other term if you do not blindly side with your family whether the family is right or wrong‚ you will be on your own when you need help. Actually this is
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Coursework unit 1 Section checklist: This is an overall checklist of all the sections and ‘extras’ that you need to include in your project. Tick them off as you complete them REMEMBER: Leave the contents page until last as you need to number all the pages first! Section Heading Completed Title page (including name‚ candidate number and title of your project Contents (list all your sections and give the page numbers) Introduction and aims Data Collection (method or methodology)
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