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Consumers expectations do not effect demand.
Select one:
a. False
b. True
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- Demand for Orange Juice is given asQd = 5000 – 2500 P + 1200 I + 650 E – 255 PsSuppose Income is I = Rs.500, Expectations E = 55, and Price of Ps = Rs 25.a. Find the Demand Equation.b. Using the demand function from part a.,Calculate Elasticity of Demand for price range of Rs.125 and Rs.155.c. What will be the ‘Price Elasticity of Demand’ at P = Rs.125?d. Interpret the Elasticity of Demand calculated in (C) above.Explain the statement. Whether true or false. Consumer future expectations plays an significant role in determining the price of a good or service.How can expectations about the future change what consumer buy now?
- Compare and contrastadaptive expectations and rationalexpectations.7. How can expectations affect demand and supply in the real estate market? 8. What is the price elasticity of demand and how it can affect the real estate market? How would the investors behave in an elastic/ inelastic market? How do we count elasticity? What determines the price elasticity of demand (the role of substitutes in real estate market)?The Federal Reserve is expected to lower interest rates three to six months from now, creating expectations of a hotter housing market. The number of houses for sale in the market today will likely: rise. not change. fall. Obecome unpredictable.
- Can you explain the . pure expectation theory, preferred habbit theory, biased expectations theory and market segmentation theory?11 Demand forecasting is necessary for effective inventory management. Select one: a. False. b. True.Match the statement to whether it describes rational expectations or adaptive expectations: A. Decisions are relatively slow to respond to new information about the economy B. If people expect it to rain a lot next month, they will start buying umbrellas today to take advantage of the relatively lower prices 1. Rational expectations 2. Adaptive expectations
- If most people have rational expectations, how long will recession last ? Explain.Q.Assume that a commercial real estate whose monthly rent is TRY6,000 is to be sold at TRY4,000,000. Inflation rate has been 10% and the nominal interest rate 16% on the average for the last 15 years. The economy has grown at a real rate of 4% over the same period, so have rental revenues. If an investor has adaptive expectations, should he/she buy the real estate or not? Explain why.Without prices to coordinate supply to demand, technocrats and central planners must use statistics. What is one thing that prices capture that statistics cannot? Prices capture quantitative information O Prices capture macroeconomic fluctuations O Prices capture the historical movements of supply and demand Prices capture future expectations