Economics of Enterprise Answers

The exact simple interest of 5000 invested from February 28, 2000 to December 31, 2000 is 1000. What is the rate of interest?

In buying a computer disk, the buyer was offered the options of paying 250 cash at the end of 30 days or 270 at the end of 120 days. At what rate is the buyer paying simple interest if he agrees to pay at the end of 120 days

A company has decided to purchase a new machine for $95.000. The new machine will be kept for 10 years. before being sold for 5000. what is the maximum amount of taxis can be paid keep this machine acceptable if the rate of return is 5 percent.

Using appropriate diagram(s), explain how a decrease in the price of the cars would

affect the demand of fuel.

The impact lag is shorter for monetary policy than for fiscal policy.

a. True

b. False

Using examples of your choice, discuss whether the desirability of the worldwide movement towards the market economy and away from the planned economy

The Production Possibility Curve is a constrained diagram, showing the maximum production capacity of a country". Using examples of your choice, discuss the validity of the statement. 

Solve this question: Supposed a consumer utility function is written as U=(2q1,q2) where q1 and q2 are commodities 1 and 2 respectively. Let their respective price be given as p1=#2,p2=#8 and income be given as: B=#240. Use the above data to:

A. Find the maximum values of q1 and q2 that the consumer will consumed.

B. Show that the budget constraint is satisfied in the sense that all the income will be spent.

C. Show that the equal marginal principle is fulfilled.

there are 100 bakeries producing bread at a neighourhood with 10,000 households. each households demands curve is given by p = 5 - yD where yD referes to hundred loaves of bread , and p is in dollars per loaf. each backery faces the same short run and long-run cost function c(y)= y² + 4

find the new SR industry supply curve at the long-run equilibrium number of backeries.

1. y^SR = 2500p
2. y^SR=5000p
3. y^SR= 10000p

The Arun ice cream’s lowers the price of its vanilla ice cream from Rs.55/- per kg to Rs.40/ kg. Vanilla ice cream sales increases by 20 %. The company notices that the sales of chocolate syrup increased by 10 %.

a. What is the price elasticity co-efficient of vanilla ice cream?

b. Why have the sales of chocolate syrup increased and how would you measure the effect?

c. Overall, do you think that the new price policy was beneficial for the Arun ice cream?