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ECO404 Managerial Economics Assignment No. 2 Solution Fall 2015 Due Date February 09, 2016

ECO404 Managerial Economics Assignment No. 2 Solution Fall 2015 Due Date February 09, 2016

ECO404 - Managerial Economics Assignment No. 2 Solution Fall 2015 Due Date February 09, 2016

SEMESTER FALL 2015

MANAGERIAL ECONOMICS (ECO404)

ASSIGNMENT NO. 02

DUE DATE:

Feb 9, 2016

MARKS: 15

PROBLEM # 1:

Maximize Profit (ð) = 14X + 9Y

Subject to the following constraints:

4X + 2Y + SA = 30

1X + 1Y + SB = 20

3Y + SC = 31

The corner points are given as:

Corner points  X  Y

 A 6  0 B 5  2 C 3  4 D 0  6
From all this information, algebraically solve the linear programming problem  while finding the profit (Rs.) level at each point. Also indicate profit maximizing corner point.  (Marks: 4 + 1)

PROBLEM # 2:

The Water and Power Development Authority (WAPDA) has recently published the following estimates of demand and supply relations for electricity:

 Q D = 70,000 - 20,000P Q S = 30,000P
Calculate the perfectly competitive industry equilibrium price/output combination.
1. b.                    Assume that the industry output is organized into a cartel. Calculate the industry

price/output combination that will maximize profits for cartel members. (Note: As a cartel, industry MR=P=3.5 - 0.0001Q and MC=P=0.00003Q)

(Marks: 2.5 + 2.5)

PROBLEM # 3:

Following diagram shows the short run price and output determination under monopoly.

From the above diagram indicate profit maximizing output level, market price and average

cost at that level..

(Marks: 2 + 3)

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Replies to This Discussion

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.

koi discussion to start karo yar...

assignment ki samjh e nai aa rahi...

Dear Students Don’t wait for solution post your problems here and discuss ... after discussion a perfect solution will come in a result. So, Start it now, replies here give your comments according to your knowledge and understandings....

Please share the idea solution

Maximize Profit (ð) = 14X + 9Y

how to find x and y value any one can help ?

es dfa kese ny solutionnahi btaya
ghult bat hy. humein yahan pur to hel milni chahy speacily economics ky liy to

My solutions are as under
Req-1
Corner Point X Y 14X+9Y Profit
A 6 0 14(6)+9(0) 84
B 88
C 78
D 54
Profit maximizing point is B

Req-2(a)
P = 1.4
Q = 42,000

Req-2(b)
Q = 26,923
P = 0.8077

Req-3
Maximizing output level = 500
market price = \$11
average cost = \$8

Please let me know whether these are correct answers or or or or ???????

1st to correct hai , second and third ksy solve kia apny ?

2nd question kis lecture say hai ? please tell me

Qs=Qd

30,000P = 70,000-20,000P

30,000P+20,000P = 70,000

50,000P=70,000

P = 1.4

With P=7 we can find the quantity demanded and the quantity supplied at the equilibrium price/output combination.

Qs= 30,000P

Qs= 30,000(1.4)

Qs= 42,000

b)

MR=MC

3.5-0.0001Q=0.00003Q

3.5=0.00003Q+0.0001Q

Q=26,923

P=0.00003Q

P=0.00003(26,923)

P=0.81

I think according to book , Problem No. 1 will be solved like this.. Its my opinion. Please help me guys today is last date!!!!!!!

y=25 kaise aya?

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