Suppose a market is characterized by the following:

QD = 1,500-3P

QS = -500+2P

A) Determine the equilibrium price and quantity .

B) Graph the equilibrium price and quantity in part A)

C) Suppose the government imposes a per-unit tax of 5 (ie. 5 dollars in tax on every unit

purchased) on buyers. Solve for the new equilibrium price and quantity. HINT: There are

two prices and one quantity to solve for. .

D) Determine the total amount of tax revenue collected by the per-unit tax in B) .

Discuss the differences between frictional, structural, and cyclical unemployment. As a member of the labor force, are you employed? Unemployed? Explain the basis of your answer.

Suppose we learn that the price elasticity of demand for luxury custom homes is -2.13, but for ordinary track homes it is -0.67. Interpret these elasticities, providing descriptions that an average person can understand. In addition, explain why a taxing authority might want to understand the elasticity concept when deciding whether or not to place a higher tax on luxury homes than on ordinary homes.

3. Individuals and policy makers for large groups can make decision errors when they do not consider benefits and costs at the MARGIN. Consider either actions taken to reduce the spread of the Covid virus or actions that might be taken to reduce racism. Illustrate what it means to consider benefits and costs as the margin. Do your best to distinguish problematic thinking from more proper thinking.

How does foreign direct investment contribute to technology transfer?

#1

Toll lanes on a section of the​ I-40 freeway are being considered in order to reduce traffic congestion and travel times.

Since this is a government​ project, the​ B-C ratio method must be applied in the evaluation. The following are cost and other​ estimates:

-Construction costs​=​$17,200,000

Operating and maintenance costs​ =​$521,000 per year

Projected service life​ =24 years

Savings in travel times and revenues generated from the tolls​ =​$5,152,000 in the first year of operation and projected to increase by 2.5% per year due to the projected annual increase in traffic. In​ addition, environmental analysis estimates that the project will result in increased noise and air pollution that will cause an additional societal health cost of $552,000 the first year and is also projected to increase at 2.5% per year.Assuming zero market​ (salvage) value at the end of 24 years and a MARR of 9​% per​ year, should the toll lanes be constructed?

a). The conventional​ benefit-cost ratio of the project with PW is_______

b). According to the​ B-C ratio​ method, the toll lanes should be constructed or not?

The Market Forces of Supply and Demand (Continued from Q1)

Consider two functions:

Supply function: ? = ? + 5

Demand function: ? = 20 − 4?

a. For some reasons (e.g. wage level rises), the supply decreases. Note that it means the supply curve shifts to the left. More precisely, consider the quantity supplied decreases by 5 units for each price level. Write down a new supply function and draw a graph of the new supply curve and demand curve. [Hint: See part f in Question 1.]

b. Compare the new equilibrium quantity and price (we often call this pair of quantity and price a market outcome) to the old one in part e in question 1. Does the equilibrium price increase? Does the equilibrium quantity increase?

5. Managing the pace of change posed a tricky problem for leaders in the early twentieth century. How did President Wilson try to control the dynamic of social and political change? What methods of change was he unwilling to accept?

a. Define elasticity, calculate and interpret the following elasticities:

b. Outline the three (3) motives of money demand.

c. Highlight any two (2) functions of money.

d. Discuss any five (5) reasons behind the prevalence of poverty in rural areas.

a. „Unemployment is a bad omen for many families as well as the nation at large‟. Discuss the aforementioned statement.

b. With the aid of diagrams, explain how fiscal and monetary policies can be used to deal with the problem of unemployment.

a. Discuss how the cultural environmental factors can affect the retail industry in Botswana. (Make use of relevant examples in your discussion).

b. With the aid of a relevant diagram and an example, outline the concept of opportunity cost.

Annual net profits at a facility are shown in the table below. Total capital for the facility
investment is known to be $ 140 000. Linear as the depreciation method in profitability calculations
depreciation will be accepted. Interest type compound interest and cash flows are separated.
It indicated. In case the minimum acceptable turning speed is 15%,
a) Net return method,
b) Investigate whether the investment is profitable using the net present value method.
Years Net profits, $ / year
1 30 800
2 20 000
3 25 000
4 35 000
5 10 000