(A)The monthly supply of desktop personal computers is given by the equation QS = 15,000 + 43.75P. At a price of $800, what is the price elasticity of supply? Q 2. (B) The British Automobile Company is introducing a brand new model called the "London Special." Using the latest forecasting techniques, BAC economists have developed the following demand function for the "London Special": QD = 1,200,000 - 40Pa) What is the point price elasticity of demand at prices of (a) $8,000 and (b) $10,000?b) Is it Elastic, Unit Elastic or Inelastic, Explain why? (A)Phoenix Lumber Company uses the number of construction permits issued to help estimate demand (sales). The firm collected the following data on annual sales and number of construction permits issued in its market area:No. of ConstructionSalesYearPermits Issued (000)(1,000,000)20036.5010.3020046.2010.1020056.6010.5020067.3010.8020077.8011.2020088.2011.4020098.3011.30(a)Which variable is the dependent variable and which is the independent variable?(b)Determine the estimated regression line.(c)Calculate the coefficient of determination. Give an economic interpretation to the value obtained.(d)Suppose that 8,000 construction permits are expected to be issued in 2010. What would be the point estimate of Phoenix Lumber Company's sales for 2010?Q 3. (B)Following output for the multiple regression problem shows results as results. SUMMARY OUTPUTRegression StatisticsMultiple R0.70955R Square0.503461Adjusted R Square0.410359Standard Error2.130054Observations20ANOVA dfSSMSFSignificance FRegression373.6059324.535315.407670.0092117Residual1672.594074.537129Total19146.2 CoefficientsStandard Errort StatP-valueLower 95%Upper 95%Intercept48.630816.32473847.6889849.2E-0735.22296862.038661Price of Coke-0.30350.1711745-1.773070.09525-0.66637790.0593694Ad Expenditure0.3429370.16558822.0710210.05489-0.00809470.6939678Pepsi Price0.234060.13935041.6796530.11244-0.06134930.5294699Find and Interpret Adjusted Coefficient of Determination, Adjusted R2, and the Correlation Coefficient, R. The ANOVA table gives the F statistic for testing the claim that there is no significant relationship between your all of your independent and dependent variables. The sig. value is your p value. Using p-value decide you should Reject or Accept claim.Write the Fitted Regression line from the results?Decide about significance using the p-value.(A)The Accuweather Corporation manufactures barometers and thermometers for weather forecasters. In an attempt to forecast its future needs for mercury, Accuweather's chief economist estimated average monthly mercury needs as: N = 500 + 10Xwhere N = monthly mercury needs (units) and X = time period in months (January 2008= 0). The following monthly seasonal adjustment factors have been estimated using data from the past five years:MonthAdjustment FactorJanuary 15%April 10%July−20%September 5%December−10%(a)Forecast Accuweather's mercury needs for January, April, July, September, and December of 2010.(b)The following actual and forecast values of mercury needs in the month of November have been recorded:YearActualForecast200845648020093243602007240240Q 4. (B) Emco Company has an assembly line of fixed size A. Total output is a function of the number of workers (crew size) as shown in the following schedule:Crew SizeTotal Output(No. of Workers)(No. of Units)0 0110235350456559660760858Determine the following schedules:(a)Marginal productivity of labor(b)Average productivity of labor(c)(d)Elasticity of production with respect to laborDraw and Show relationship MPL & APL(A)During the last few days the Superior Company has been running into problems with its computer system. The last run of the production cost schedule resulted in the incomplete listing shown below. From your knowledge of cost theory, fill in the blanks.QTCTFCTVCATCAFCAVCMC 040__________x xxx 1_______________52 _______________ 2__________20____________________ 3_______________21.33_______________ 4______________________________4 5__________40____________________ 6_______________15.67_______________ 7_________________________10_____ 8__________96____________________ 9_________________________15_____10______________________________45Q 5. (B) Sunrise Juice Company sells its output in a perfectly competitive market. The firm's total cost function is given in the following schedule:OutputTotal Cost(Units)($) 0 50101202017030210402605033060430Total costs include a "normal" return on the time (labor services) and capital that the owner has invested in the firm. The prevailing market price is $7 per unit.(a)Prepare (i) marginal cost and (ii) average total cost schedules for the firm.(b)What is the firm's profit maximizing output level?(c)Is the industry in long-run equilibrium? Justify your answer.(A)A candy manufacturer has 130 pounds of chocolate-covered cherries and 170 pounds of chocolate-covered mints in stock. He decides to sell them in the form of two different mixtures. One mixture will contain half cherries and half mints by weight and will sell for $2.00 per pound. The other mixture will contain one-third cherries and two-thirds mints by weight and will sell for $1.25 per pound. How many pounds of each mixture should the candy manufacturer prepare in order to maximize his sales revenue? let us call A the mixture of half cherries and half mints, and B the mixture which is one-third cherries and two-thirds mints. Let x be the number of pounds of A to be prepared and y the number of pounds of B to be prepared. The revenue function can then be written as Since each pound of A contains one-half pound of cherries and each pound of B contains one-third pound of cherries, the total number of pounds of cherries used in both mixtures is Similarly, the total number of pounds of mints used in both mixtures is: Now, since the manufacturer can use at most 130 pounds of cherries and 170 pounds of mints, we have the constraints: Also, we must have Therefore, the above problem can be formulated as follows: find x and y that maximize subject to the constraints: Use the technique of linear programming and find feasible region of the problem and locate our extreme points.Q 6. (B)Make a linear programming graph from the following LP model and find out the most profitable solution.Maximize CM = $25A + $40BSubject to: 2A + 4B ≤ 100 hours 3A + 2B ≤ 90 A ≥ 0, B ≥ 0

Question

(A)The monthly supply of desktop personal computers is given by the equation QS = 15,000 + 43.75P. At a price of $800, what is the price elasticity of supply? Q 2.     (B)            The British Automobile Company is introducing a brand new model called the &#34;London Special.&#34; Using the latest forecasting techniques, BAC economists have developed the following demand function for the &#34;London Special&#34;:          QD = 1,200,000 - 40Pa) What is the point price elasticity of demand at prices of (a) $8,000 and (b) $10,000?b) Is it Elastic, Unit Elastic or Inelastic, Explain why? (A)Phoenix Lumber Company uses the number of construction permits issued to help estimate demand (sales). The firm collected the following data on annual sales and number of construction permits issued in its market area:No. of ConstructionSalesYearPermits Issued (000)(1,000,000)20036.5010.3020046.2010.1020056.6010.5020067.3010.8020077.8011.2020088.2011.4020098.3011.30(a)Which variable is the dependent variable and which is the independent variable?(b)Determine the estimated regression line.(c)Calculate the coefficient of determination. Give an economic interpretation to the value obtained.(d)Suppose that 8,000 construction permits are expected to be issued in 2010. What would be the point estimate of Phoenix Lumber Company's sales for 2010?Q 3.     (B)Following output for the multiple regression problem shows results as results. SUMMARY OUTPUTRegression StatisticsMultiple R0.70955R Square0.503461Adjusted R Square0.410359Standard Error2.130054Observations20ANOVA dfSSMSFSignificance FRegression373.6059324.535315.407670.0092117Residual1672.594074.537129Total19146.2    CoefficientsStandard Errort StatP-valueLower 95%Upper 95%Intercept48.630816.32473847.6889849.2E-0735.22296862.038661Price of Coke-0.30350.1711745-1.773070.09525-0.66637790.0593694Ad Expenditure0.3429370.16558822.0710210.05489-0.00809470.6939678Pepsi Price0.234060.13935041.6796530.11244-0.06134930.5294699Find and Interpret Adjusted Coefficient of Determination, Adjusted R2, and the Correlation Coefficient, R. The ANOVA table gives the F statistic for testing the claim that there is no significant relationship between your all of your independent and dependent variables.  The sig. value is your p value.  Using p-value decide you should Reject or Accept claim.Write the Fitted Regression line from the results?Decide about significance using the p-value.(A)The Accuweather Corporation manufactures barometers and thermometers for weather forecasters. In an attempt to forecast its future needs for mercury, Accuweather's chief economist estimated average monthly mercury needs as:        N = 500 + 10Xwhere N = monthly mercury needs (units) and X = time period in months (January 2008= 0). The following monthly seasonal adjustment factors have been estimated using data from the past five years:MonthAdjustment FactorJanuary  15%April  10%July−20%September    5%December−10%(a)Forecast Accuweather's mercury needs for January, April, July, September, and December of 2010.(b)The following actual and forecast values of mercury needs in the month of November have been recorded:YearActualForecast200845648020093243602007240240Q 4.     (B)            Emco Company has an assembly line of fixed size A. Total output is a function of the number of workers (crew size) as shown in the following schedule:Crew SizeTotal Output(No. of Workers)(No. of Units)0 0110235350456559660760858Determine the following schedules:(a)Marginal productivity of labor(b)Average productivity of labor(c)(d)Elasticity of production with respect to laborDraw and Show relationship MPL & APL(A)During the last few days the Superior Company has been running into problems with its computer system. The last run of the production cost schedule resulted in the incomplete listing shown below. From your knowledge of cost theory, fill in the blanks.QTCTFCTVCATCAFCAVCMC  040__________x     xxx  1_______________52     _______________  2__________20____________________  3_______________21.33_______________  4______________________________4  5__________40____________________  6_______________15.67_______________  7_________________________10_____  8__________96____________________  9_________________________15_____10______________________________45Q 5.     (B)            Sunrise Juice Company sells its output in a perfectly competitive market. The firm's total cost function is given in the following schedule:OutputTotal Cost(Units)($)  0  50101202017030210402605033060430Total costs include a &#34;normal&#34; return on the time (labor services) and capital that the owner has invested in the firm. The prevailing market price is $7 per unit.(a)Prepare (i) marginal cost and (ii) average total cost schedules for the firm.(b)What is the firm's profit maximizing output level?(c)Is the industry in long-run equilibrium? Justify your answer.(A)A candy manufacturer has 130 pounds of chocolate-covered cherries and 170 pounds of chocolate-covered mints in stock. He decides to sell them in the form of two different mixtures. One mixture will contain half cherries and half mints by weight and will sell for $2.00 per pound. The other mixture will contain one-third cherries and two-thirds mints by weight and will sell for $1.25 per pound. How many pounds of each mixture should the candy manufacturer prepare in order to maximize his sales revenue? let us call A the mixture of half cherries and half mints, and B the mixture which is one-third cherries and two-thirds mints. Let x be the number of pounds of A to be prepared and y the number of pounds of B to be prepared. The revenue function can then be written as Since each pound of A contains one-half pound of cherries and each pound of B contains one-third pound of cherries, the total number of pounds of cherries used in both mixtures is Similarly, the total number of pounds of mints used in both mixtures is: Now, since the manufacturer can use at most 130 pounds of cherries and 170 pounds of mints, we have the constraints:  Also, we must have  Therefore, the above problem can be formulated as follows: find x and y that maximize  subject to the constraints: Use the technique of linear programming and find feasible region of the problem and locate our extreme points.Q 6.     (B)Make a linear programming graph from the following LP model and find out the most profitable solution.Maximize CM = $25A + $40BSubject to: 2A + 4B ≤ 100 hours      3A + 2B ≤ 90      A ≥ 0, B ≥ 0

Accepted Answer

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(A) The monthly supply of desktop personal computers is given by the equation QS = 15,000 + 43.75P. At a price of $800, what is the price elasticity of supply?