Q3. Demand is given by (P+ 10)(Q + 20) = 1000 and supply byQ – 4P+ 10 = 0. Determine the equilibrium, show it graphi-cally as accurately as possible and determine the consumer sur-plus (round up to the nearest integer). How will this surplus beaffected if price increases by 2 and the equilibrium is not realized?Q4. A firm produces three goods (G1, G2, G3) and sells them in aperfectly competitive market. Table 1 shows the number of units(in thousands) sold of each good along with the total revenue (in1,000$) the firm raised by these sales in each calendar month of2019. Find the equilibrium prices of these goods using matrices.Table 1: Sales and revenue by calendar monthNb. units soldTotalMonthG1 G2 G3revenueJanuaryFebruaryMarch3466.24273146AprilMay340763June2433JulyAugustSeptember437444427439October3237November4343December42740Q5. The demand functions for product A and B are each a functionof the prices of A and B and are given by:QA = 50 and QB = 75VPADetermine whether A and B are competitive products, comple-mentary products, or neither.- 2-See Next Page Q1. A sole producer has a marginal revenue function given by:dTR= 100 – 3Q?dQIs demand elastic or inelastic if they produce 5 units?Q2. The Gini coefficient is a number between 0 and 1 and is usedfor measuring inequality. A number closer to 1 indicates higherinequality. Graphically, the Gini coefficient is given by the areabetween a diagonal straight line with slope equal to 1 and theLorenz curve and this figure divided by the area below the diago-nal. If The Lorenz curve is given by y = pa²+ px, estimate theinequality (up to 4 decimals). Compute the Gini coefficient. Isthis an equal or unequal society? Figure 1 represents the diagonalstraight line in red and the Lorenz curve in gray.Figure 1: Lorenz curve and Gini coefficientLorenz Curve24.68-1-See Next Page

We are going to use the relationship between Marginal revenue and elasticity to solve a question…

Answered: Q1. A sole producer has a marginal…

Q1. A sole producer has a marginal revenue function given by: dTR = 100 – 3Q² %3D OP Is demand elastic or inelastic if they produce 5 units?

ENGR.ECONOMIC ANALYSIS

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ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

Q3. Demand is given by (P+ 10)(Q + 20) = 1000 and supply by
Q – 4P+ 10 = 0. Determine the equilibrium, show it graphi-
cally as accurately as possible and determine the consumer sur-
plus (round up to the nearest integer). How will this surplus be
affected if price increases by 2 and the equilibrium is not realized?
Q4. A firm produces three goods (G1, G2, G3) and sells them in a
perfectly competitive market. Table 1 shows the number of units
(in thousands) sold of each good along with the total revenue (in
1,000$) the firm raised by these sales in each calendar month of
2019. Find the equilibrium prices of these goods using matrices.
Table 1: Sales and revenue by calendar month
Nb. units sold
Total
Month
G1 G2 G3
revenue
January
February
March
3
46
6.
2
42
7
3
1
46
April
May
3
40
7
63
June
2
4
33
July
August
September
4
37
4
4
44
2
7
4
39
October
3
2
37
November
4
3
43
December
4
2
7
40
Q5. The demand functions for product A and B are each a function
of the prices of A and B and are given by:
QA = 50 and QB = 75
VPA
Determine whether A and B are competitive products, comple-
mentary products, or neither.
- 2-
See Next Page

Q1. A sole producer has a marginal revenue function given by:
dTR
= 100 – 3Q?
dQ
Is demand elastic or inelastic if they produce 5 units?
Q2. The Gini coefficient is a number between 0 and 1 and is used
for measuring inequality. A number closer to 1 indicates higher
inequality. Graphically, the Gini coefficient is given by the area
between a diagonal straight line with slope equal to 1 and the
Lorenz curve and this figure divided by the area below the diago-
nal. If The Lorenz curve is given by y = pa²+ px, estimate the
inequality (up to 4 decimals). Compute the Gini coefficient. Is
this an equal or unequal society? Figure 1 represents the diagonal
straight line in red and the Lorenz curve in gray.
Figure 1: Lorenz curve and Gini coefficient
Lorenz Curve
2
4
.6
8
-1-
See Next Page

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