You are on page 1of 5

Question no.

1A:

i.
market demand curve
40

30

price 20

10

0
1 2 3 4 5 6 7 8
10 40 35 30 25 18 15 10 5
20
30
40 appartments

ii. The highest price is $ 18.
iii. The lowest price is $15.
iv. A-B-C-D.
v. $11-15.

Question No. 1 B:
i.

person A B C D E F G H
high price 18 18 18 18 25 18 25 25
low price 16 16 16 16 19 16 19 19

ii. $ 18 is the highest price, and the price is still at its equilibrium price.

Question No 1C:

(40+35+30+25+18) vi. He will charge $18 to maximize his revenue. iii. $ 13. Question No. $ 18. iii. P1X1+P2 X2=m or P1X1+P2X2≤m or 10X1+5X2=40 ii. person A B C D E F G H Reservation price $ 45 40 35 30 23 20 15 10 ii. Number 1 2 3 4 5 6 7 8 Price 40 35 30 25 18 15 10 5 Revenue 40 70 90 100 90 90 70 40 ii. $ 18. 1E: i. $148. Question No 1D: i. 2A: i. A-B-C-D-F. iii. i. Question NO. iv. iv. m/p2 = 40/5 = 8 units. Landlord revenue will be reduced. ii. E will sublet to F. X-axis: commodity 1 . m/p1 = 40/10 = 4 units iii. Market outcome will remain same. iv. F having reservation price of $ 18. v. A-B-C-D-F. A-B-C-D-F.

P/1X1+P2 X2=m or 5X1+5X2=40 v. 4 2 1v X 2 4 6 8 m/p1 m*/p1 m/p/1 iv. P/1X1+P2X2=m* or 5X1+5X2=30 Question No. P+2M+3J=180. Price of jam=3 units. So price of meatballs =2 units iii. 2P+4M+6J=360. iv. 180 units. ii. 2 crowns =1 unit of new currency. Y m/p2 8 m*/p2 Budget line at income $40. No . 6 1v Budget line when price of c1 decreased. v. 2 B: i. Budget line when income decreased to $30. Y-axis: commodity 2.

Question No.000+3. 5000/500=10 ads. consumer magazine cost=$250 each ad. 2C: i. Total budget=$5000.000 MBA’s Read by lawyers with hot tubs =10(250) = 2500 lawyers. Budget spent on consumer publication=$5000/2=$2500 Total ads in consumer publication=$2500/$250= 10 ads Read by recent MBA’s =10(300) =3.000 =8. 5000/250=20ads. iii.500 =4. Total budget=$5000. ii.000 .000 MBA’s Read by lawyers with hot tubs =5(300) = 15000 lawyers. So.500+2. Read by recent MBA’s = 20(300) =6000 MBA’s Read by lawyers with hot tubs= 20(250) =5000 lawyers. Read by recent MBA’s =10(1000) =10. Total MBA’s who read it = 5.000 MBA’s Read by lawyers with hot tubs =10(300) = 3000 lawyers.000 Total lawyers who read it = 1. Budget spent on business magazine = $5000/2 =$2500 Total ads in business magazine=$2500/$500= 5 ads Read by recent MBA’s =5(1000) =5. business magazine cost=$500 each ad .

(10000.5000) (X1. X-axis: reading by MBA’s Y-axis: reading by lawyers. 5000) Budget Line 4 (8000. Lawyers Y 8 7 6 5 (6000. Y2) = Y2-Y1/X2-X1 =5000-3000/6000-10000 = 2000/-4000 = -0. Ghjgg iv. 3000) 2 1 X 1 2 3 4 5 6 7 8 9 10 MBA’S (in thousands) v. Y1) (X2. 2000 readings by MBA’s must be sacrifice to get 1000 additional readings by Lawyers.5L/M So.3000) and (6000. . 4000) 3 (10000.iii.