Assignment (1) - Demand
_________________________________________________________________________ Name Mahmoud Ahmed Ibrahim – Group B – MBA. CU ID# _____ _____________________________________________________________________ 1 . What happens to the need for SONY television sets once each of the subsequent happens:
a) The price of LG ELECTRONICS TVs increases (the demand for SONY tv will increase). b) The cost of SONY Tv sets rises (the demand for SONY television will certainly decrease). c) Personal income falls (the demand for FIAT television will decrease). d) Dramatic value reductions arise for DISC recorders (the demand for SONY television will Increase). e) gov't imposes tariffs in Japanese TVs beginning the coming year (the demand for SONY television set will Increase).
2 . Imagine the demand to get a product (X) can be stated as a function of the price (PX), consumer regular monthly income (I), and the cost of a related good L (PR)
QX = 180 - 10 PX -- 0. 2 I + 10 PR
a) Translate the slope coefficient upon Px
(PX sama dengan 18 -- 0. 1QX - zero. 02 My spouse and i + PR)
b) Is good X a typical or second-rate good? How would you know? (X a substandard good since the coefficient of I is definitely (-0. a couple of I). c) Are merchandise X and R substitutes or harmonizes with? How do you know? (goods Back button and Ur are substitutes because the coefficient of PUBLIC RELATIONS is (+10PR). d) Forgetting income plus the price of your related good, how much buyer surplus is out there in this marketplace if the price of Times were $10,50?
At this believe we find that:
At Qx = one hundred and eighty – 10PX
From the below graph and or chart
Consumer excess = anticipated price – Actual value
Expected value = (10+18)/2 X 80 = $1120
Genuine Price sama dengan 80 X10 = $800
So Consumer surplus = 1120-800 = $320