Homework 2
Chapter 4, 6, 7, and 8
5% x 20 = 100%
th
Submission Deadline: September 30 2015
1. Due to the bandwagon effect, demand for some products is _ elastic than it would be
without the positive network externality. Explain.
2. For which of the follow
Answer Key:
1. The elasticity of demand is the percentage change in the quantity demanded divided by the
percentage change in the price. The elasticity of demand for corn flakes is therefore
Q 6
E D=
=
=2
P
P
3
2. The price elasticity of supply is the pe
CHAPTER 5
FRAMING AND THE REVERSAL OF PREFERENCES
By
Sangeeta Panigrahi (N01238292)
Charlotte Malcolm (N00872214)
Daniel Woelkers (N00633484)
Table of Contents
FRAMING.3
PREFERENCE REVERSALS.3
Framing and the Irrationality of the Sum of Our Choices.4
CER
ECP 6705
Homework 1 (Answer Key)
1. The daily demand for hotel rooms on Manhattan Island in New York is given by the
equation
QD = 250,000 - 375P. The daily supply of hotel rooms on Manhattan Island is given by
the equation QS = 15,000 + 212.5P.
What is t
Homework 2
Answer Key
1. The market for wheat consists of 500 identical firms, each with the total and marginal
cost functions shown:
TC = 90,000 + 0.00001 Q2
MC = 0.00002Q,
where Q is measured in bushels per year. The market demand curve for wheat is Q =
1. The daily demand for hotel rooms on Manhattan Island in New York is given by the
equation QD = 250,000 - 375P. The daily supply of hotel rooms on Manhattan Island is
given by the equation QS = 15,000 + 212.5P. What is the equilibrium price and quantity
WTP-measurements and robustness of
preference orders based on competitive
designs such as the brand-price-trade-of
approach or choice based conjoint analysis
AIM
To analyze how the willingness to pay (WTP) and robustness of preference orders based on
comp
Chapter 2: Question # 10, 11, 12, and 13
Short answer
10)
Why do we tend to overplace our ability relative to others on easy tasks?
Ans: While we tend to underestimate our performance, we tend to underestimate the
performance of others to an even larger e
Elasticity: Problem set
1. Harding Enterprises has developed a new product called the Gillooly Shillelagh. The
market demand for this product is given as follows:
Q = 240 - 4P
a.
b.
c.
d.
At what price is the price elasticity of demand equal to zero?
At w
Study Guide for Economics
6 steps of the Scientific Method
Step 1: Asking questions
Step 2: Conducting research
Step 3: Forming a hypothesis
Step 4: Investigating through the use of a method or procedure
Step 5: Collecting data and making observations
Ste
Answers:
1)
a.
The demand curve given in this problem is linear. The intercepts of the inverse demand curve on
the price and quantity axes are $60 and 240 respectively. The price elasticity of demand varies
along the length of this demand curve. Demand is