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Economics - MACRO EXAM NOTES

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Issue:

Business

 

Written by:

Wm H

 

Date added:

July 14, 2016

 

Level:

University

 

Grade:

A

 

No of pages / words:

5 / 1165

 

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5819 times

 

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Essay content:

(2 marks) Optimality condition: MRS=- pc/ph. --> -4h/c=pc/ph. (1 mark) Substituting this expression into the budget constraint pcc+phh=m, you will find: c=4/5*m/pc, h=1/5*m/ph. (2 marks) B) (5 marks) Jennifer works in an office building with 399 other people who each have the same preferences and lunch income as Jennifer...
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What is the market demand function for this group of 400 individuals? Answer: Aggregate demand=400* 1/5*m/ph. C) (5 marks) When each person's m = $30, and when ph = $4, what will the total number of hot sandwiches demanded be? Answer: 60. D) (5 marks) Find the price elasticity of demand for hot sandwiches when ph = $4 and each person's m = $30...
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