ECON 162
HW 2
ECON HW代写 The demand curve represents a.the amount of a good a consumer buys b.the amount of a good a consumer buys, given…
Q1 Multiple Choice Questions ECON HW代写
- The demand curve represents
a.the amount of a good a consumer buys
b.the amount of a good a consumer buys, given the quantity the seller is willing to sell
c.the amount of a good a consumer is willing to buy, given prices
d.none of the above
2.When an airline price its fare at $240, 100 seats were sold. Then, after the airline reduce the price by $5, 110 seats were sold. What is the absolute price elasticity of demand for the airline’s fare?
a.10 ECON HW代写
b.4.8
c.2.5
d.6.5
3.Suppose consumers will always buy gasoline no matter how high the price that seller would charge. The gasoline market is:
a.perfectly Elastic
b.perfectly Inelastic
c.perfectly Linear
d.none of the above
4.Suppose a firm’s production technology is given by Q = KL1/2. If we are in the short run and the firm is using 10 units of capital input, how many workers will this firm hire if it wants to produce 100 units of output? ECON HW代写
a.1 worker
b.10 workers
c.100 workers
d.1000 workers
5.Which of the following is true in the long-run?
a.A firm can vary only one of the inputs used in production.
b.A firm can vary all the inputs used in production.
c.The level of output produced cannot be varied.
d.In the long-run the marginal cost of production is zero. ECON HW代写
Q2
Assume a firm’s production cost is: long-run average cost LAC=long-run marginal cost LMC=$2 per unit and inverse demand function is given by P=8-3Q, where P denotes price per pound and Q denotes output.
(1) Determine firm’s optimal output and price.
(2) Suppose the wholesale market can be divided into two segments with the demand functions given by P1= 10-5Q1 and P2 = 6-2Q2. If firm is able to discriminate the price between these two market segments and resale is impossible between the two segments, what price should firm charge for each market segment?
Q3 (True or False, and give explanations) ECON HW代写
(1) Assume marginal cost is a constant number which is not 0, then when price elasticity
of demand is equal to -1, we are saying that the profit is maximized.
(2) Assume marginal cost is a constant number which is not 0, then we are saying that
the firm will always choose a point of a demand curve where it is elastic.
Q4
