1A) What is the definition of opportunity cost? The best alternative that we forgo‚ or give up‚ when we make a choice or a decision is called the opportunity cost of that decision. 1B) Eason wants to spend $15 to buy a pack of sandwiches or a bowl of fish-ball noodles form a street hawker. Explain the effect on Eason’s opportunity cost of buying the sandwiches if a cockroach is found inside the noodle soup. Eason’s opportunity cost of buying the sandwiches is a bowl of fish-ball noodles‚ however
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CHAPTER 12 Microeconomics The Demand for Resources Topic Question numbers ___________________________________________________________________________________________________ 1. Derived demand 1-8 2. Resource demand curve; optimal hiring 9-59 3. Determinants of resource demand 60-97 4. Elasticity of resource demand 98-114 5. Optimal combination of resources 115-145 6. Marginal productivity theory of income distribution 146-149 Consider This 150-151 Last Word 152-154 True-False
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elasticities of demand in three categories‚ based on their absolute value. If the absolute value of the price elasticity of demand is greater than 1‚ demand is termed price elastic. If it is equal to 1‚ demand is unit price elastic. And if it is less than 1‚ demand is price inelastic. Therefore in that case it is price inelastic for high-income consumers. (Decision‚ D. C. 1956) Figure 1and 2. Income elasticity shows the percentage increase in the demand for a given good as a result of a percentage
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computed as the percentage change in quantity demanded divided by the percentage change in price. (Principles of Economics‚ 2007) An example is coffee if the price of coffee goes up then the consumer could buy tea instead of coffee. This make coffee elastic. 3. Determine if the demand for the following
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Managerial Economics B Ad 5102 Study Guide for Mid-Term Exam DO PRACTICE QUIZZES‚ STUDY GUIDE QUESTIONS‚ PROD EX‚ TEST BANK You may construct a “formula sheet” that has only expressions‚ no words‚ except those words that identify the formula or use a sheet that is a legacy of previous classes. Your own personal sheet will need to be inspected by me upon completion of the test. The test will cover Chapters 1-3 and 5. You will respond to five (5) of six (6) identification questions
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In general‚ businesses are aware of demand curves; however‚ it is rare that they actually know how to recognize those curves. In order to make sound business decisions‚ it is important to be able to recognize certain elements of a demand curve. For instance‚ if Apple raised its prices by five percent‚ what would happen to its revenues? The answer to this question depends on the response of Apple consumers. Will the consumer refrain from making purchases completely or just cut back on them? How a
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Demand can be defined as the quantity of particular good or service that consumers are willing and able to purchase at various price levels at a given point in time. Market demand for a product can be illustrated on a demand curve. Other factors such as a change in the level of income and a movement along a demand curve. Price elasticity of demand measures the responsiveness or sensitivity of the quality demanded of a particular product to change in its price. There are a number of factors that affect
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[pic] Swinburne University of Technology (Sarawak Campus) HBE613 ECONOMICS Higher Education Division Microeconomics Test Term 1‚ 2013 12.5% of Total Unit Marks (to be marked out of 20) Time Allowed: 1 hour Name: ______________________________________ Student ID: ______________________________________ Swinburne University of Technology‚ Sarawak Campus Short Answer Questions There are 4 questions in this section. Each question is worth
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price of the products or goods‚ such as coffee and tea. Substitutes and income influence the elasticity of a good or product. Caffeine itself if price inelastic as it has no substitute and consumers will pay whatever price they have to for their morning coffee. 3. Determine if the demand for the following products is price elastic or price inelastic‚ and explain your answer. In your explanation‚ be sure to include how
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1- That would be inelastic. Even though people gripe about the rising prices‚ that doesn’t stop people from stopping by the gas pumps to fill up.Elastic is more like candy bars or soda; if priced at 50 cents‚ there will be high demand‚ but if the price rises to 2 dollars‚ the demand will go down.Because there are many alternative brands for Coca Cola that have more or less the same taste. When the price of coca cola rises‚ demand decreases because consumers will find alternative brands that taste
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