Master of Business Administration - MBA Semester I MB0042 – Managerial Economics - 4 Credits (Book ID: B0908) Assignment Set- 1 ( 60 Marks) Note: Each question carries 10 Marks. Answer all the questions. Q.1 Price elasticity of demand depends on various factors. Explain each factor with the help of an example. Q.2 A company is selling a particular brand of tea and wishes to introduce a new flavor. How will the company forecast demand for it ? Q.3The supply of a product
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momentum and mechanical energy were investigated by performing multiple experiments with differing conditions. Conservation laws state energy is to be conserved in systems with no net external forces. Two trials consisted of inelastic collisions and two trials consisted of elastic conditions. Photogate software helped decipher initial and final velocities in order to perform calculations applied to conservation law equations. In both cases of conservation of momentum and kinetic energy‚ low relative
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by making the demand more elastic. Now that oil prices have sky rocketed the American people are demanding more fuel efficient cars and demanding less cars that are on the market today. Therefore the demand for cars on the market today is inelastic. As gas prices increase demand for cars decrease and revenues decrease. Chrysler is creating a supply to meet the new demand for electric cars to increase their revenue. Right now the supply for electric cars is very inelastic because there are not many
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The Concept of Elasticity Themes of Today’s Lecture What is an Elasticity? Why Economists Use Elasticity Definitions of Elasticity How to Compute the Elasticity of Demand and Supply Examples of Elasticity of Demand and Supply What is an Elasticity? Measurement of the percentage change in one variable that results from a 1% change in another variable. When the price rises by 1%‚ quantity demanded might fall by 5%. The price elasticity of demand is -5 in this example. Different
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of the responsiveness of the quantity of a good demanded to changes in its price. Demand is price inelastic when PED1 (but less than infinity).If a product has elastic demand‚ then a change in the price of the product leads to a greater than proportional change in the quantity demanded of it. When demand is inelastic‚ most of the tax incidence (tax burden) is on consumers;when demand is elastic‚most of the incidence is on producers. If a government puts a tax on a product‚ then its price
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demanded increases from 50 to 60 units. Therefore demand for X in this price range: A. has declined. B. is of unit elasticity. C. is inelastic. D. is elastic. 6. Refer to the above diagram. Between prices of $5.70 and $6.30: A. D1 is more elastic than D2. B. D2 is an inferior good and D1 is a normal good. C. D1 and D2 have identical elasticities. D. D2 is more elastic than D1. 7. Refer to the above diagram and assume a single good. If the price of the good decreases from $6.30 to $5.70‚ consumer
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Collision Lab Simulation Purpose: To study elastic and inelastic collisions in one-dimension. Background Information: Momentum: is a measure of mass in motion. It is the product of mass x velocity. Conservation of Momentum: in the absence of external forces‚ such as friction‚ the linear momentum of a system remains constant. Procedure: 1. Open web browser and go to the site: http://phet.colorado.edu 2. Click “play with sims”‚ then “physics”‚ and then “motion” 3. Find the “Collision
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TASK 1 Consider the following equation: MRSXY < PX/PY where MRS = marginal rate of substitution x and y are two goods P = price < = is less than {draw:frame} The graph above shown us the indifference curve budget line diagram which explaining the equation MRSXY < P X / PY. There are two ways to measure the consumer preferences or what the consumer wants. The first one is by trying to put a ‘value’ on the satisfaction a consumer obtains from consuming
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consumers’ income decrease. B. Elasticity of Demand is shown when there is a percentage change in the quantity demanded to the percentage change in the price. When the coefficient is greater than 1‚ the demand is elastic. When the coefficient is less than 1‚ the demand is inelastic. When the coefficient is equal to 1‚ the demand is of unit-elasticity. Cross-price elasticity is demonstrated when there is a percentage change in the demand for one good relative to a percentage change in the price
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Examine the importance of the elasticity of demand in a government decision to impose a specific tax on the buyers of cigarettes Price Elasticity of Demand is the responsiveness of a change in the quantity demanded of a certain good to a change in its price. The formula for Price Elasticity of Demand is the percentage change in the quantity demanded of a certain good divided by the percentage change in the price of that certain good (Alain Anderton‚ p.55). A specific tax is a tax that’s amount
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