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28 Sep 2019
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A..If we examine the market for rice in Pakistan duringtheyear 2007 and 2009,
the demand of rice was higher in the year 2007 but it felldownduring the
year 2009, due to the drop in the export demand of rice.Butthe
Government wants to keep the price of rice at higher level.
The given equations show the quantity demanded and quantitysuppliedof
rice during the year 2007.
Year 2007: Demand: Qd = 1,600 - 125P
Year 2007 Supply: Qs = 440 + 165P
a. Calculate the market clearing price levelandquantity in the year
2007, in that year there were no effective limitations on the
production of rice.
b. Why the government wants to keep the priceathigher level i.e. to
$5.50 when there is decline in export demand. Will it effectonthe
quantity demanded or quantity supplied equation and curveandhow
much?
c. Now with the help of new quantityequationcalculate what should be
the quantity of rice which the government must buy?
B.Suppose a profit-maximizing monopolist is producing800units of output
and is charging a price of $70 per unit.
If the marginal cost of last unit produced is 50 what will betheelasticity of
demand for the product?
.
A..If we examine the market for rice in Pakistan duringtheyear 2007 and 2009,
the demand of rice was higher in the year 2007 but it felldownduring the
year 2009, due to the drop in the export demand of rice.Butthe
Government wants to keep the price of rice at higher level.
The given equations show the quantity demanded and quantitysuppliedof
rice during the year 2007.
Year 2007: Demand: Qd = 1,600 - 125P
Year 2007 Supply: Qs = 440 + 165P
a. Calculate the market clearing price levelandquantity in the year
2007, in that year there were no effective limitations on the
production of rice.
b. Why the government wants to keep the priceathigher level i.e. to
$5.50 when there is decline in export demand. Will it effectonthe
quantity demanded or quantity supplied equation and curveandhow
much?
c. Now with the help of new quantityequationcalculate what should be
the quantity of rice which the government must buy?
B.Suppose a profit-maximizing monopolist is producing800units of output
and is charging a price of $70 per unit.
If the marginal cost of last unit produced is 50 what will betheelasticity of
demand for the product?
A..If we examine the market for rice in Pakistan duringtheyear 2007 and 2009,
the demand of rice was higher in the year 2007 but it felldownduring the
year 2009, due to the drop in the export demand of rice.Butthe
Government wants to keep the price of rice at higher level.
The given equations show the quantity demanded and quantitysuppliedof
rice during the year 2007.
Year 2007: Demand: Qd = 1,600 - 125P
Year 2007 Supply: Qs = 440 + 165P
a. Calculate the market clearing price levelandquantity in the year
2007, in that year there were no effective limitations on the
production of rice.
b. Why the government wants to keep the priceathigher level i.e. to
$5.50 when there is decline in export demand. Will it effectonthe
quantity demanded or quantity supplied equation and curveandhow
much?
c. Now with the help of new quantityequationcalculate what should be
the quantity of rice which the government must buy?
B.Suppose a profit-maximizing monopolist is producing800units of output
and is charging a price of $70 per unit.
If the marginal cost of last unit produced is 50 what will betheelasticity of
demand for the product?
Samantha BalandoLv7
28 Sep 2019
