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Some questions have more than one part. Try and attempt every part of the question. That way, even if you do not get the answer completely correct, it will at least be possible for you to get partial credit. I cannot give partial credit if you do not attempt to answer a question. For mathematical part, provide the necessary formula and detail work leading to the correct answer (as much as possible) for full credit. Provide graph wherever necessary. Note: All answers should be written in your own words.
This assignment is based on some of the material covered in chapters 2, 3, 4 and 5 of the textbook, Miller. It will be helpful to read the sections of the book relevant to this assignment before attempting to complete the assignment.

1. Chapter 2: Opportunity Cost:
The following table illustrates the points a student can earn on examination in Economics and Biology if the student uses all available hours for study.
Economics       Biology
100                      40
90                        60
80                        75
70                        85
60                        93
50                        98
40                      100
a) Does the PPC illustrates the Law of Increasing Additional cost? Explain your answer.
b) What is the Opportunity cost to this student for the additional amount of study time on economics required to move her grade from 60 to 70?
c) What is the Opportunity cost to this student for the additional amount of study time on economics required to move her grade from 90 to 100?

2. Chapter 3: Equilibrium in the Market
Suppose that in a recent market period, an industry wide survey determined the following relationship between the price (P) of Television and the quantity supplied and quantity demanded.
Price                Quantity of TVs                Quantity of TVs
Per TV          Demanded per Month       Supplied per Month
$800                        2,000                                 12,000
$750                        3,000                                 11,000
$700                        4,000                                 10,000
$650                        5,000                                  9,000
$600                        6,000                                  8,000
$550                        7,000                                  7,000
$500                        8,000                                  6,000
$450                        10,000                                 4,000
Answer the following questions from the above table:
(a) What are the equilibrium price (P) and quantity (Q) of television?
(b) If the industry price per TV is $450, will there be a shortage or a surplus of TVs in the market? How much will be the shortage or surplus?
(c) At what price will there be an excess supply of 6,000 TV?

3. Chapter 4: Impact of Minimum wage:
In advance of the recent increase in the U.S. minimum wage rate, the government of the state of Arizona decided to boost its own minimum wage by an additional $1.60 per hour.
This pushed the wage rate earned by Arizona teenagers above the equilibrium wage rate in the teen labor market. What is the predicted effect of this action by Arizona’s government on each of the following?
a) The quantity of labor supplied by Arizona teenagers.
b) The quantity of labor demanded by employers of Arizona teenagers.
c) The number of unemployed Arizona teenagers.

4. Chapter 5: Externalities
State the different ways Government can correct:
a) Positive externality
b) Negative externality            

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a) Does the PPC illustrate the Law of Increasing Additional cost? Explain your answer.

As the student allocates more time studying Biology, the amount of points that could have been earned in Economics decreases. Therefore, it does not illustrate the Law of Increasing Additional Cost.

b) What is the Opportunity cost to this student for the additional amount of study time on economics required to move her grade from 60 to 70?

It would cost her 8 points forgone in Biology....
$8.00 for this solution

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