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    Assignment CFM (RUCHIT GUPTA) PDF

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    The document is an assignment given to a student named Ruchit Gupta. It includes 4 exercises analyzing demand and supply of various goods. Exercise 1 asks the student to determine the market demand equation for a fruit seller with 2 customers, find the price to sell all fruit, and explain what happens if price is above or below equilibrium. Exercise 2 provides a demand equation for oranges and asks the student to find equilibrium price and quantity, and excess demand or supply if the government sets non-equilibrium prices. Exercise 3 analyzes Hewlett-Packard's strategy of selling PCs at low profit to increase demand for complementary goods like printers, and the impact on HP and competitor Dell. Exercise

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    Assignment CFM (RUCHIT GUPTA) PDF

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    ruchit gupta
    1K views11 pages
    The document is an assignment given to a student named Ruchit Gupta. It includes 4 exercises analyzing demand and supply of various goods. Exercise 1 asks the student to determine the market demand equation for a fruit seller with 2 customers, find the price to sell all fruit, and explain what happens if price is above or below equilibrium. Exercise 2 provides a demand equation for oranges and asks the student to find equilibrium price and quantity, and excess demand or supply if the government sets non-equilibrium prices. Exercise 3 analyzes Hewlett-Packard's strategy of selling PCs at low profit to increase demand for complementary goods like printers, and the impact on HP and competitor Dell. Exercise

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    The document is an assignment given to a student named Ruchit Gupta. It includes 4 exercises analyzing demand and supply of various goods. Exercise 1 asks the student to determine the market demand equation for a fruit seller with 2 customers, find the price to sell all fruit, and explain what happens if price is above or below equilibrium. Exercise 2 provides a demand equation for oranges and asks the student to find equilibrium price and quantity, and excess demand or supply if the government sets non-equilibrium prices. Exercise 3 analyzes Hewlett-Packard's strategy of selling PCs at low profit to increase demand for complementary goods like printers, and the impact on HP and competitor Dell. Exercise

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    1K views11 pages

    Assignment CFM (RUCHIT GUPTA) PDF

    Uploaded by

    ruchit gupta
    The document is an assignment given to a student named Ruchit Gupta. It includes 4 exercises analyzing demand and supply of various goods. Exercise 1 asks the student to determine the market demand equation for a fruit seller with 2 customers, find the price to sell all fruit, and explain what happens if price is above or below equilibrium. Exercise 2 provides a demand equation for oranges and asks the student to find equilibrium price and quantity, and excess demand or supply if the government sets non-equilibrium prices. Exercise 3 analyzes Hewlett-Packard's strategy of selling PCs at low profit to increase demand for complementary goods like printers, and the impact on HP and competitor Dell. Exercise

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    of 11

    Assignment

    Consumers, Firms and Markets


    Veena Pailwar
    IMT Nagpur
    Demand and Supply Analysis: Exercise 1

    ______________________________________________________________________________
    Name: RUCHIT GUPTA Roll No. 202021024

    Batch: 2020-2022 Date: 5TH SEPTEMBER 2020

    Assume that there is a fruit seller who has 40 kilograms (kg) of mangoes to be sold. He
    wants to fix the price at the level so that all the mangoes are sold. There are two customers
    in the market. Their individual demand curves are given as below:
    D1 = 50-1.00 P
    D2 = 20 -0.5 P
    On the basis of above information, answer the following questions:
    1. Determine the market demand equation for the fruit seller.
    2. Find out the price at which he can sell all the mangoes.
    3. What will happen if the price is set below or above the equilibrium price level?
    Explain diagrammatically.
    ANSWERS
    1.

    1
    2.

    2
    3.

    3
    Consumers, Firms and Markets
    Veena Pailwar
    IMT Nagpur
    Demand and Supply Analysis: Exercise 2
    ______________________________________________________________________________
    Name: RUCHIT GUPTA Roll No. 202021024

    Batch: 2020-2022 Date: 5TH September 2020

    The quantity demanded of oranges depends upon the price of oranges (Po), monthly
    income of orange consumers (Y) and the price of apples which are substitutes for oranges
    (Pa). Demand for oranges (Qo) is given by the equation Do= 1500 -10Po + 4Y + Pa. The
    supply function for oranges (So) is given by the equation So = 800 + 2 P0

    1. Find the demand equation for oranges in terms of price for oranges (Po), when Y is
    Rs 500 and Pa is Rs 60.
    2. Find the equilibrium price and quantity.
    3. What is the excess demand or supply if the government sets the price as (a) Rs 250
    and (b) Rs. 200?
    4. How will this excess demand or supply get cleared if the market forces are not
    allowed to operate?

    Answers

    1.

    4
    2.

    5
    3.

    6
    Consumers, Firms and Markets
    Veena Pailwar
    IMT Nagpur
    Demand and Supply Analysis: Exercise 3
    ______________________________________________________________________________
    Name: RUCHIT GUPTA Roll No. 202021024

    Batch: 2020-2022 Date: 5TH SEPTEMBER 2020

    Hewlett Packard is in the business of supplying Personal Computers (PCs) and the goods which are
    complementary to PCs, such as printers, consultancy to firms purchasing printers, and consumer
    electronics. Dell is a major rival firm for Hewlett Packard. Dell is primarily focused on the business of
    PCs.
    Hewlett Packard management sees PCs playing a strategic role in their plan to maximize profit for
    Hewlett Packard as a whole. It is willing to sell PCs for a little or no profit, because selling PCs increases
    demand for complementary products, such as printers.
    1. Show the impact of this strategy on the market for HP PCs.
    2. Analyze the impact of this strategy on the demand for printers. Given the supply curve for
    printers, how will this strategy affect the equilibrium quantity and price of printers. Depict the
    impact diagrammatically.
    3. How will the strategy adopted by Hewlett Packard affect the demand for PCs from Dell? What
    will Dell do to retain its customers? Depict the impact diagrammatically.
    ANSWERS

    1.

    7
    2.

    8
    3.

    9
    Consumers, Firms and Markets
    Veena Pailwar
    IMT Nagpur
    Demand and Supply Analysis: Exercise 4
    ______________________________________________________________________________
    Name: RUCHIT GUPTA Roll No. 20202104

    Batch: 2020-2022 Date:5TH SEPTEMBER 2020

    The personal computer prices fell during 2003, as they have every year since 1981. These price declines
    are the result of positive technological change that has reduced the cost of making PCs.
    Using the above information, answer the following:
    1. Analyze the impact of this change in the environment on the demand for and/ or supply of PCs.
    Depict the impact on the equilibrium price and quantity of PCs diagrammatically.
    2. Who is expected to benefit from such technological changes?

    ANSWERS

    1.

    10
    2.

    11

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