103assn2summer09

103assn2summer09 - Principles of Microeconomics Neil...

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Principles of Microeconomics Neil Roberts ECON 103 Spring 2009 Assignment #2 (25 marks) Due: Monday, June 08, 2009 1. The following table shows the prices and quantity demanded of Alberta wheat in 1998 and 1999. The change in 1999 resulted from exceptional weather, resulting in a bumper crop. 1998 1999 Bushels produced 1.74 billion 1.9 billion Average price per bushel $3.70 $2.72 a. Using the midpoint method, calculate the price elasticity of demand for wheat. (4 marks) b. What is the total revenue for Albertan wheat farmers in 1998 and 1999? (2 marks) c. How did the bumper crop affect the incomes of Albertan wheat farmers? How could you have predicted this from your answer to part a? (4 marks) 2. Consider the market for pizza in Middleton, Ontario, whose demand and supply schedules are given in the table below. Price of Pizza ($) Quantity Demanded Quantity Supplied 10 0 6 9 1 5 8 2 4 7 3 3 6 4 2 5 5 1 4 6 0 3 7 0 2 8 0 1 9 0 a. Graph the demand and supply curves. (4 marks) b. What is the consumer surplus and producer surplus? (2 marks)
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This note was uploaded on 12/07/2010 for the course ECON ECON 103 taught by Professor S during the Spring '10 term at Simon Fraser.

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