Homework #3 - Darial [email protected] Managerial Economics...

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Darial Sneed @02638624 Managerial Economics 12:40 Class Homework #3 Questions: 3.1,3.5, 3.8 Homework #3: 3.1, 3.5, 3.8 3.1 Question: The following relations describe monthly demand and supply conditions in the metropolitan area for recyclable aluminum Qd= 317,500 – 10,000P (demand) Qs= 2,500 + 7,500P (Supply) Where Q is quantity measured in pounds of scrap aluminum and P is price in cents. Complete the following Answer: Price (1) Quantity Supplied (2) Quantity Demanded (3) Surplus (+) or Shortage (-) (4)= (2) – (3) 15cents 2,500 + 7,500 (15) = 115,000 317,500-10,000(15) = 167500 115,000-167,500= -52500 shortage 16 2,500 + 7,500(16) = 122,500 317,500-10,000(16) = 157500 122,500-157500= -35000 shortage 17 2,500 + 7,500(17) = 130,000 317,500-10,000(17) = 147500 130,000-147,500= -17500 shortage 18 2,500 + 7,500(18) = 137,500 317,500-10,000(18) = 137500 137,500-137,500= 0 neither 19 2,500 + 7,500(19) = 145,000 317,500-10,000(19) = 127500 145,000-127,500= 17500 surplus 20 2,500 + 7,500(20) = 152,500 317,500-10,000(20)= 117500 152,500-117,500= 35000 surplus 3.5 Question: The Creative Publishing Company (CPC) is a coupon book publisher with markets in several southeastern states. CPC coupon books are sold directly to the public, sold through religious and other charitable organizations, or given away as promotional items. Operating experience during the past years suggests the following function for CPC’s coupon bonds.
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