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# fall 2016 eco401 assignment 1

ECONOMICS (ECO401)
ASSIGNMENT NO. 01
DUE DATE: NOVEMBER 21, 2016
MARKS: 20
ASSIGNMENT:
The Case:
Uber Technologies Inc. is an American worldwide online transportation network company
whose headquarter is in San Francisco, California. This company was established in 2009. It
developed markets over 66 countries and 507 cities all over the world. Those people who have
cars can register with this company and can earn money. Services of this company are also
beneficial for the consumers because fare is very low. This company also started services in
Pakistan in March 2016. Uber service demand is increasing day by day and car holders are also
getting registration. Suppose the Uber Company in Pakistan is facing the following demand and
supply functions:
Qd = 4000-4P
Qs= 1000+P
Where ‘Pis the price of fare per ride and Qdis quantity demanded in terms of number of cars
demanded by consumers. Qsis number of cars offered by company.
Requirements:
a) Find equilibrium price and equilibrium quantity of cars. Also show equilibrium condition
with the help of graph.
b) Calculate price elasticity of demand using point elasticity method when the company is in equilibrium and interpret the result.
c) What will be the effect on the equilibrium situation of the company if fuel prices increase remarkably in the market? Illustrate graphically.
(Marks: a: 2+2+3, b: 5+3, c: 5)
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### Replies to This Discussion

any 1 have its solution?? then tell me

I have slove it solution

mjy send kren

But how to create graphs diagram on ms word

o bhai anyone idea solution pl

Qd= 4000-4p

Qs= 1000+p

Sol:-

Qd=Qs

4000 - 4p = 1000 + P

4000-1000 = 4p + P

3000 = 5p

p = 3000/5

p = 600

To find euilibrium quantity putt the value of "p" in any of demand & Supply

so

Qd = 4000 -4(600)

= 4000 - 2400

= 1600

OR

Qs = 1000 + 600

=  1600

The equilibrium Price is 600 & equilibrium quantity is 1600

if i solved correct then any body help me plx how to Draw graph and more solution

problem e diagram ha solution apka thk ha

Graph is easy just plot prices on vertical axis and quantity on horizontal axis.

you have to show quantity supplied as well. make your base for graph i.e

Price     Demand   Supply

600       1600       1600

bhai yein itna kiya ha muje bi thora samja do.

I think to make a graph we need to make the schedule

Our main purpose here discussion not just Solution
We are here with you hands in hands to facilitate your learning and do not appreciate the idea of copying or replicating solutions.

how to create a Graph?

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