Essay on ECN100 HW2 3

#5. Other things equal, what effects would each of the following have on aggregate demand or aggregate supply? In each case use a diagram to show the expected effects on the equilibrium price level and the level of real output.

2.4)Describe ways to ensure that own interactions with individuals respect their beliefs, culture, values and preferences

After that, there's the fact that pennies are quite useless. Most of the time they only get their use if you buy an item that ends in .99 or .98, if you got rid of the penny most prices would be in denominations of .05, so it’s easier to add, and in turn less confusing, the downside is that it costs a cent more, but it doesn’t add up to much. Another problem is that they take up too much space, since they are

Initially, 1 dime was added to the cup, followed by the addition of 1 penny, then 1 nickel, and finally 1 quarter. The idea was to add the coins in order from the lightest coin in weight (dime) to the heaviest (quarter) in order to get an upward trend line. When 1 dime was added to the cup, the force was 0.03 N, however, when a penny was added to the cup, the force was increased to a total of 0.05 N. This represented only a 0.02 N change when the penny was added. This information is inferring that a dime weighs more than a penny, however, this is not true. An error that may have occurred could be that the penny was added before the dime was added. Therefore, the penny would have weighed 0.3 N and the dime would have weighed 0.2 N. However, the information in Table 3 does demonstrate that the nickel weighs less than the quarter, but more than the penny and dime, giving an upward trend line. The slope of the line passing through points (1,0.03) and (4,0.2) is 0.056 N. Therefore, 0.056 N is the average weight of the coins. The x-values represent the # of coins, the y-values represent the force (N), and the y-intercept value is 0. Initially, a linear graph was generated for Figure 3, however, the trend line did not pass through each point on the graph and the R2 value was .82. Therefore, a polynomial trend line was incorporated into the graph, as seen in Figure 3. The

What happens to the equilibrium price and quantity after these changes are put into effect? Do they go up, down or stay the same?P:_____down_____________Q:_____down__________________

B.The net gain on above social optimal price is when the government establishes the price above the socially optimal level of 14 cents. This causes the production to decline below 35 million kilowatt hours per month, which leads to decreases in consumer benefits. But on the other hand, the decreases

Kids like beers, Nowadays students prefer beer to ice cream. Young generation brings new taste, new change & challenge. As Ben &

3- Question's order : I think it is better to answer the questions which have the same idea in sequential, such as Q 5-13.

- She should increase the cheese and decrease the consumption of cheese, so Marginal utility per unit of money of Cheese will decrease to 10. And she need to decrease the wine. therefore, the Marginal utility per unit of money of wine will increase to 5.

The following statistics stated in the case indicate that “23% of respondents would definitely buy the Montreaux dark chocolate with fruit product and 40% would probably buy the product.” These average ratings strongly suggest that this product should be introduced into the market very gradually. This strategy would enable the company to evaluate consumer buying patterns so that the company could determine future production levels and future marketing strategies that benefit both the company and the consumer. Financial information given in the case also indicates that the company needs to introduce this product very conservatively. Exhibit 1 informs that with 5.98 million total purchases, low awareness, low ACV and mediocre product, Montreaux would gross $17.44 million. Exhibit 2 shows that with medium awareness, medium ACV and an average product Montreaux would gross $25.1 million. These figures do not meet Montreaux’s objective of earning at least $30 million in its first year. Exhibit 3 shows a slightly improved situation: with high awareness, high ACV, and an excellent product, Montreaux would gross

|ECONOMIC |Inflation would increase the price of drinks and at the same time, consumers’ real disposable |

2012). Using the Figure 1, this process can be shown as follows: the subsidy enables greater production, shifting the supply line from ‘Supply’ to ‘Supply + Subsidy’. The new market equilibrium is at (P1, Q1), a greater quantity and lower price than the old equilibrium (P0, Q0). However, to supply at the new equilibrium quantity Q1, producers need the higher price P2, reflecting the increasing marginal cost of production. The government pays the difference (P2-P1) per unit of fuel, thus making total government expenditure equal to areas [B+C+D+E+F].

15. Refer to Figure 21-2. Which of the graphs in the figure reflects a decrease in the price of good X only? a. graph (a) b. graph (b) c. graph (c) d. graph (d) ANS: B PTS: 1 DIF: 2 REF: 21-1 TOP: Budget constraint MSC: Analytical 16. Refer to Figure 21-2. Which of the graphs in the figure reflects an increase in the price of good Y only? a. graph (a) b. graph (b) c. graph (c) d. graph (d) ANS: C PTS: 1 DIF: 2 REF: 21-1 TOP: Budget constraint MSC: Analytical 17. Refer to Figure 21-2. Which of the graphs in the figure could reflect a decrease in the prices of both goods? a. graph (a) b. graph (b) c. graph (c) d. graph (d) ANS: D PTS: 1 DIF: 2 REF: 21-1 TOP: Budget constraint MSC: Analytical 18. The slope of the budget constraint is determined by the a. relative price of the goods measured on the axes. b. relative price of the goods measured on the axes and the consumer’s income.

The law of diminishing marginal utility describes a familiar and fundamental tendency of humanbehavior. The law of diminishing marginal utility states that:

There are times when I simply cannot decide between sweetened iced tea, and unsweetened iced tea, but offering me a third option (that is most similar to one of the sweetened levels for example, ¼ sweet tea mixed with ¾ unsweet) to aid my decision making process has been a well-documented marketing strategy for years. Introducing a “decoy” (or dominated alternative) helps consumers narrow their focus on the simpler choice. However, choosing sweet tea may involve giving up the fewer-calorie-healthier-for-me option found in the unsweet tea, and this can cause conflicts in my process that result in an absence of the decoy’s intended benefit. Choosing the sort of iced beverage I consume on a hot day has little significance compared to the sort