Eco401 Assignment No. 1 solution
Saturday, April 16, 2011 Posted In Eco Edit ThisSemester “Spring 2011”
“Economics (ECO401)”
This is to inform that Assignment # 01 (covering video lecture no. 1 to lecture no 10) will be uploaded on VULMS according to the following schedule
Schedule
Opening Date and Time
April 12, 2011 At 12:01 A.M. (Mid-Night)
Closing Date and Time
April 15, 2011 At 11:59 P.M. (Mid-Night)
Note: Only in the case of Assignment, 24 Hrs extra / grace period after the above mentioned due date is usually available to overcome uploading difficulties which may be faced by the students on last date. This extra time should only be used to meet the emergencies and above mentioned due dates should always be treated as final to avoid any inconvenience.
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Solution of ECO401
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(A)
Qd = 5000 – 2.5P
When
price = 250
Qd = 5000 – 2.5P
Qd = 5000 – 2.5(250)
Qd = 5000 –625
Qd =4375
When
price = 450
Qd = 5000 – 2.5P
Qd = 5000 – 2.5(450)
Qd = 5000 –1125
Qd =3875
When
price = 650
Qd = 5000 – 2.5P
Qd = 5000 – 2.5(650)
Qd = 5000 –1625
Qd =3375
(B)
Qs = 4000 + 1.5P
When
price = 200
Qs = 4000 + 1.5P
Qs = 4000 + 1.5(200)
Qs = 4000 + 300
Qs = 4300
When
price = 400
Qs = 4000 + 1.5P
Qs = 4000 + 1.5(400)
Qs = 4000 + 600
Qs = 4600
When
price =600
Qs = 4000 + 1.5P
Qs = 4000 + 1.5(600)
Qs = 4000 + 900
Qs = 4900
(C)
Qd = 5000 – 2.5P
Qs = 4000 + 1.5P
Qd = Qs
5000-2.5P =4000-1.5P
-2.5P+1.5P=4000-5000
-1P = (-1000)
P (Equilibrium price) =1000
Qd = 5000 – 2.5P
Q=5000-2.5(1000)
Q= 5000- 2500
Q (equilibrium quantity) = 2500
CHECK
Qd = 5000 – 2.5P
2500 =5000-2.5(1000)
2500 =5000-2500
2500 =2500
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for Part A Quantity Demand
Qd = 5000 - 2.5P
P= price
Qd1 = 5000 - 2.5(250) =4,375
Qd2 = 5000 - 2.5(450) = 3,875
Qd3 = 5000 - 2.5(650) = 3,375
For Part B Quantity supplied
Qs = 4000 +1.5P
Qs1 = 4000 + 1.5(200) = 4,300
Qs2 = 4000 + 1.5(400) = 4,600
Qs3 = 4000 + 1.5(600) = 4,900
For Part C
Qd = Qs
5000-2.5P = 4000+1.5P
1.5P+2.5P = 5000-4000
4P=1000
P=1000/4
P=250
Q= 5000-2.5P
= 5000 - 2.5(250)
= 5000 - 625
= 4375
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Qd= 5000-2.5P
= 5000 - 2.5(250)
= 5000 - 625
= 4375
Qs= 4000+1.5p
=4000+1.5(250)
=4000+375
=4375
hence:
Qd=Qs
4375=4375
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A. Find quantity demanded when price is Rs. 250, Rs. 450 and Rs. 650.
C. Find equilibrium price and equilibrium quantity with the help of above
equations.
Levis
Marks: A=3(1 for each value), B=3(1 for each value), C=8(4 for each value), D=6
“Economics (ECO401)”
This is to inform that Assignment # 01 (covering video lecture no. 1 to lecture no 10) will be uploaded on VULMS according to the following schedule
Schedule
Opening Date and Time
April 12, 2011 At 12:01 A.M. (Mid-Night)
Closing Date and Time
April 15, 2011 At 11:59 P.M. (Mid-Night)
Note: Only in the case of Assignment, 24 Hrs extra / grace period after the above mentioned due date is usually available to overcome uploading difficulties which may be faced by the students on last date. This extra time should only be used to meet the emergencies and above mentioned due dates should always be treated as final to avoid any inconvenience.
:::::::::::::::::::::::::::::::
Solution of ECO401
:::::::::::::::::::::::::::::::
(A)
Qd = 5000 – 2.5P
When
price = 250
Qd = 5000 – 2.5P
Qd = 5000 – 2.5(250)
Qd = 5000 –625
Qd =4375
When
price = 450
Qd = 5000 – 2.5P
Qd = 5000 – 2.5(450)
Qd = 5000 –1125
Qd =3875
When
price = 650
Qd = 5000 – 2.5P
Qd = 5000 – 2.5(650)
Qd = 5000 –1625
Qd =3375
(B)
Qs = 4000 + 1.5P
When
price = 200
Qs = 4000 + 1.5P
Qs = 4000 + 1.5(200)
Qs = 4000 + 300
Qs = 4300
When
price = 400
Qs = 4000 + 1.5P
Qs = 4000 + 1.5(400)
Qs = 4000 + 600
Qs = 4600
When
price =600
Qs = 4000 + 1.5P
Qs = 4000 + 1.5(600)
Qs = 4000 + 900
Qs = 4900
(C)
Qd = 5000 – 2.5P
Qs = 4000 + 1.5P
Qd = Qs
5000-2.5P =4000-1.5P
-2.5P+1.5P=4000-5000
-1P = (-1000)
P (Equilibrium price) =1000
Qd = 5000 – 2.5P
Q=5000-2.5(1000)
Q= 5000- 2500
Q (equilibrium quantity) = 2500
CHECK
Qd = 5000 – 2.5P
2500 =5000-2.5(1000)
2500 =5000-2500
2500 =2500
:::::::::::::::::::::::::::::::::::::::::::::::::::::::::::
for Part A Quantity Demand
Qd = 5000 - 2.5P
P= price
Qd1 = 5000 - 2.5(250) =4,375
Qd2 = 5000 - 2.5(450) = 3,875
Qd3 = 5000 - 2.5(650) = 3,375
For Part B Quantity supplied
Qs = 4000 +1.5P
Qs1 = 4000 + 1.5(200) = 4,300
Qs2 = 4000 + 1.5(400) = 4,600
Qs3 = 4000 + 1.5(600) = 4,900
For Part C
Qd = Qs
5000-2.5P = 4000+1.5P
1.5P+2.5P = 5000-4000
4P=1000
P=1000/4
P=250
Q= 5000-2.5P
= 5000 - 2.5(250)
= 5000 - 625
= 4375
:::::::::::::::::::::::::::::::::::::
Qd= 5000-2.5P
= 5000 - 2.5(250)
= 5000 - 625
= 4375
Qs= 4000+1.5p
=4000+1.5(250)
=4000+375
=4375
hence:
Qd=Qs
4375=4375
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Asssigment #1 ECO401
Quantity demand is found by putting the values of P in quantity demand
equation.
1. when the price is Rs.250
Qd = 5000 – 2.5P
Qd = 5000 – 2.5(250)
Qd = 4375 units
2.when price is Rs.450
Qd = 5000 – 2.5P
Qd = 5000 – 2.5(450)
Qd = 3875 units
3.when price is Rs.650
Qd = 5000 – 2.5P
Qd = 5000 – 2.5(650)
Qd = 3375 units
B. Find quantity supplied when price is Rs. 200, Rs. 400 and Rs. 600.
Quantity supplied is found by putting the values of P in quantity supplied
equation.
1. when the price is Rs.200
Qs = 4000 + 1.5P
Qs = 4000 + 1.5(200)
Qs = 4300 units
2.when price is Rs.400
Qs = 4000 + 1.5P
Qs = 4000 + 1.5(400)
Qs = 4600 units
3.when price is Rs.600
Qs = 4000 + 1.5P
Qs = 4000 + 1.5(600)
Qs = 4900 units
C. Find equilibrium price and equilibrium quantity with the help of above equations.
The equilibrium price for Levis jeans is found by equating Qd and Qs. At equilibrium,the quantity demand and quantity supply must equal
Qd=Qs
5000 – 2.5P= 4000 + 1.5P
5000-4000=1.5P+2.5P
1000=4P
P=1000/4=250Rs.
Equilibrium price =Rs.250
Equilibrium quantity can found by puuting this price in equation of quatity demand or quantity supply
Qs = 4000 + 1.5P
Qs = 4000 + 1.5(250)
Qs = 4375 units
Note:
At equilibrium, At equilibrium,the quantity demand and quantity supply must equal
Qd=Qs
Equilibrium price at 250
5000 – 2.5(250)= 4000 + 1.5(250)
4375 units=4375 units
D. Show the equilibrium condition in Levis jeans market graphically.Marks: A=3(1 for each value), B=3(1 for each value), C=8(4 for each value), D=6
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Question:
Suppose the market demand and market supply forLevis
following equations:
Qd = 5000 – 2.5P
Qs = 4000 + 1.5P
Suppose the market demand and market supply for
following equations:
Qd = 5000 – 2.5P
Qs = 4000 + 1.5P
A. Find quantity demanded when price is Rs. 250, Rs. 450 and Rs. 650.
Quantity demand is found by putting the values of P in quantity demand equation.
When the price is 250
Qd = 5000-2.5p
Qd = 5000-2.5(250)
Qd = 5000 -625
Qd = 4375 units
When the price is 450
Qd = 5000- 2.5p
Qd = 5000 -2.5(450)
Qd = 5000 – 1125
Qd =3875units
When the price is 650
Qd = 5000-2.5p
Qd = 5000 -2.5(650)
Qd = 5000-1625
Qd =3375 unit
B. Find quantity supplied when price is Rs. 200, Rs. 400 and Rs. 600.
Quantity supplied is found by putting the values of P in quantity supplied equation.
1. When the price is Rs.200
Qs = 4000 + 1.5P
Qs = 4000 + 1.5(200)
Qs = 4000 + 300
Qs = 4300 units
2. When price is Rs.400
Qs = 4000 + 1.5P
Qs = 4000 + 1.5(400)
Qs = 4000 + 600
Qs = 4600 units
3. When price is Rs.600
Qs = 4000 + 1.5P
Qs = 4000 + 1.5(600)
Qs = 4000 + 900
Qs = 4900 units
C. Find equilibrium price and equilibrium quantity with the help of above
equations.
The equilibrium price for Levis
At equilibrium, the quantity demand and quantity supply must equal
Qd=Qs
5000 – 2.5P= 4000 + 1.5P
5000-4000=1.5P+2.5P
1000=4P
P=1000/4=250Rs.
Equilibrium price =Rs.250
Equilibrium price =Rs.250
Equilibrium quantity can found by puuting this price in equation of quatity demand or quantity supply
Qs = 4000 + 1.5P
Qs = 4000 + 1.5(250)
Qs = 4375 units
Qd=Qs
Equilibrium price at 250
5000 – 2.5(250)= 4000 + 1.5(250)
5000-625 = 4000 +375
4375 units = 4375 units
D. Show the equilibrium condition in Marks: A=3(1 for each value), B=3(1 for each value), C=8(4 for each value), D=6
