1.An electrical component manufacturer has the following:

Price () received for each component sold:5

Fixed costs ():20,000

Constant marginal cost ():2

What is the break even level of production (Quantity)?

2.Assume an economy's annual money velocity in circulation is 10. Please answer the following two questions: a. If the annual nominal GDP is $200 trillion, how much money supply are enough for money demand? In the view of monetarists (i.e. neoclassical view), if the annual economic growth rate is 5% What should be the money supply increasing rate to maintain a low inflation rate as 2%? (i.e. neoclassical view), if the annual economic growth rate is 5%, An increase on in the in the quantity of money would increase the aggregate demand and the curve would shift rightward. what should be the money supply increasing rate to maintain a low inflation rate as 2%?

3.Mr. Hassan demand function for rice is given by x=15+m(10p)^-1

where x=amount of rice demanded, m=income of the consumer, p=price of rice. Originally the income of Mr.Hassan is 4800 per month and the price of rice is 120 per kg. If the price falls to 100 per kg. Calculate the total effect, substitution effect and income effect emanating from this change in price.

4.Explain the concept of the Equi-Marginal Principle of Consumer Behavior.

5.Explain ways in which the return to the factor of production enterprise differs from the return to other factors of production.

6. explain three assumptions underlying the theory of imperfect competition.

7.Given the demand function of a monopolist operating two plants is equal to Q=400-4p and cost functions for plant A is equal to C=20Q and plant B is equal to C=0.5Q

Assuming the monopolist can price discriminate determine the profit maximizing output from plant A and from plant B and the price charged by the monopolist.

8.What is economic profit and accounting profit with the information given?

Price=$20, Quantity=400units, Unit cost=$15, implicit cost=$4,000 explain your answer.

9.The optimization rule in the short run, a firm will increase the variable factor up the point at which its MRP (MRxMP) is equal to the price of the input (MRP for labor=P for labor=wage rate). A firm finds that the MP of capital is 60 units and the MP of labor is 20 units. If the price of capital is $6 and the price of labor is $2.50, how should the firm adjust its mix of capital and labor? What would be the result?

10.30% of all Girl Scout cookies sold are Thin Mints. If we select 9 boxes of cookies at random, what is the probability at most 5 of them are Thin Mints?