ECO402 Microeconomics Assignment No 01 Solution & Discussion Due Date: 23-05-2018

[+ M.TariK MaliC]

ECO402 Microeconomics Assignment No 01 Solution & Discussion Due Date: 23-05-2018

The Case:
Sugarcane is an important cash crop of Pakistan. It is mainly grown for
sugar and sugary production. It is an important source of income and
employment for the farming community of the country. During 2017-18, it
showed 7.45% growth in production and its production surpassed the
targeted production in 2017-18. Sugarcane production was 58,397
thousand tonnes in 2011-12 while its production became 81,102 thousand
tonnes during 2017-18. For the year 2017-2018, government has announced
the support price of sugarcane as Rs. 180 per 40 kg. Let the demand and
supply equations of sugarcane are given as follows:
Qs = 27 + 0.25P
Qd =75 - 0.15P

 

 

Requirement:
a) Find the market clearing level of quantity and price of sugarcane. Also
show equilibrium condition graphically.
b) Find out the price elasticity of demand and price elasticity of supply of
sugarcane at equilibrium price and quantity.
c) If the government wants to strictly implement the support price P = Rs.
180, then how much amount of shortage or surplus would occur?
Marks: (5+5+5)

[+ M.TariK MaliC]

Please Discuss here about this assignment.Thanks

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. Read More>>

Discussed & be touched with this discussion. After discussion a perfect solution will come in a result at the end.

 

Note:-

For Important Helping Material related to this subject (Solved MCQs, Short Notes, Solved past Papers, E-Books, FAQ,Short Questions Answers & more). You must view all the featured Discussion in this subject group.

For how you can view all the Featured discussions click on the Back to Subject Name Discussions link below the title of this Discussion & then under featured Discussion corner click on the view all link.

Or visit this link 

Click Here For Detail.

&

.•°How to Download past papers from study groups°•.

 

Please Click on the below link to see…

.... How to Find Your Subject Study Group & Join .... 

 

P.S:    Please always try to add the discussion in proper format title like “CS101 Assignment / GDB No 01 Solution & Discussion Due Date: ___________”

[+ M.TariK MaliC]

 

Qs = 27 + 0.25P

Qd =75 - 0.15P

Point A

Market clearing prince

27+0.25P=75-0.15P

0.25p+0.15P=75-25

0.40P=50

P=50/0.40= 125

Market clearing quantity

Qs=27+0.25(125)

=27+31.25

=56.25

Point B

Price elasticity of demand

Ed=P/Q* ΔQ/ΔP

 

125/56.25*(-0.15)

2.22*(-0.15) = -0.33

 

Price elasticity of Supply

Es=P/Q* ΔQ/ΔP

125/56.25*(0.25)

2.22*(0.25) =0.55

 

 

Point C

 

Qs = 27 + 0.25(180) =72

=72-56.25=15.75 surplus

 

[Haidar Bhatti]

market clearing price main 75 - 25 hi likhyn gay ?? kion k peechay 25 nahi , 27 hai.

27+0.25P=75-0.15P

[+ M.TariK MaliC]

ECO402 Assignment#01 Idea Solution 

[Muhammad Sajid Farooq]

Thanks a lot  Malik

[Faheem]

Bhai is mein graph ka problem aa rhi hai kindly graph b upload kr dain

[Gulzar Ahmed]

can you share its graphs ???

[Wasiq Raza Zaidi]

bhai is me equilibrium condition graphically kese bane gi ???

[Meerat Tariq]

But yeh graphically kese show hoga ?