Other Economics Answers

 A 1, 500, 000 equipment has an estimated life of 20 years with a book value of 250, 000 at the end of the period. What is the depreciation charge and its book value after 10 years using the sinking fund method? 

What is the value of an asset after 8 years of use if it depreciates from its original value of 500, 000 to its salvage value of 1.5% in 10 years? (Use Straight Line Method) 

A laboratory test machine costs 150, 000, lasts for 6 years and has a salvage value of 30, 000. How much could an investor afford to pay for another 

machine of the same purpose, whose life is 10 years with a salvage value of 40,000, if money is worth 5%.

A fabrication company engaged in production of a motor part has a production capacity of 700, 000

pieces per year. But, it is just operating at 62% of its full capacity due to unavailability to finance the

importation of their materials. The company has an annual income of P 430, 000.00, annual fixed cost

are P 190, 000.00 and variable costs are P 0.348 per unit. How many productions of parts must be

produced for break-even point?

I have three different questions. Can you help me about them please?

1-) Economics is the study of 

a) Production methods.

b) How society manages its scarce resources. 

c) How housebolds decile who performs which tasks, 

d) The interaction of business and government. 

e) Consumption 

2-)The statement that demand increased means that there is a 

a) Movement to the right along a demand curve, 

b) Movement to the left akong a demand curve.

c) Rightward shift of the demand curve. 

d) Leftward shift of the demand curve. 

e) Movement to the right along a supply curve. 

3-) If the price of product X falls and this change increases the demand for product Y, then 

a) x and y are complements. 

b) x and y are substitutes. 

c) x is an inferior good. 

d) y is an inferior good. 

e) all of the above

A shortage exists in a market if

a) There is an excess supply of the good.

b) Quantity supplied exceeds quantity demanded.

c) The current price is below its equilibrium price.

d) There is no demand of the good.

e) All of the above are correct.

When the price of a good is higher than the equilibrium price,

a) A shortage will exist. b) Buyers desire to purchase more than is produced.

c) Sellers desire to produce and sell more than buyers wish to purchase.

d) Quantity demanded exceeds quantity supplied.

e) Quantity demanded is equal to quantity supplied

Q1.a. Suppose that Happy Lemon Inc. issues a bond with a coupon of 4% paid annually. The

bond has a maturity of 30 years and a yield to maturity of 7%. An investor purchased this bond

at a fair price and holds the bond for 1 year.

i.

If the yield to maturity at the end of bond’s life changes to 8%, what will be the rate of

return that this investor is going to earn at the end of year 1? (

Hint

: The fair price of

the bond is simply the present value today of all future cash flows from an investment

in a bond)

ii.

Is the following statement correct? Elaborate your answer.

“Current yield overstates the return of premium bonds and understates that of discount

bonds”

Explain the benefits and detriments of putting a tax on a certain level of pollution or create a regulation that limits the amount of pollution allowed.

Show graphically and explain an allocative efficient level of abatement. Label your graph and explain.

If she spends all of her income on trouser and shoe during Christmas shopping, Rahel can afford 8 trousers and 8 pairs of shoes. She could also use her entire budget to buy 16 trousers and 4 pairs of shoes. If the price of a trouser is 400 Birr, then A) How much is Rahel’s income allocated for Christmas shopping? B) What is the budget line equation of Rahel? C) If Rahel’s utility function is U=T0.8S0.2, where T is Trousers and S is Pair of Shoes. What is the optimal combination of Trousers and Pair of Shoes for Rahel?