ANSWER ALL QUESTIONS CORRECTLY. I WILL NOT ACCEPT ANY WRONG ANSWER. CLEAR EXPLANATION REQUIRED,NOT ONLY THE ANSWER.

1. Illustrate equilibrium price, equilibrium quantity, and total revenue received by producers in a supply-and-demand diagram.

2. Given that demand is elastic, how will a price increase affect total revenue? Explain.

How is the supply price elasticity calculated? Describe how it is measured.

A storm destroys fifty percent of the fava bean crop. This event is more likely to harm fava bean farmers if fava bean demand is highly elastic or highly inelastic. Explain

5.

List and explain the four price elasticity of demand factors discussed in the chapter.

6.

If the elasticity exceeds 1, is the demand elastic or inelastic? Demand is either perfectly elastic or perfectly inelastic when elasticity equals zero.

7. If a fixed quantity of a good is available and no more can be produced, how elastic is the supply price?

8.

Suppose country A has a deficit in its balance of payments in Year 1. In Year 2, the following changes occurred in the balance of payments:

$ Billion

export of merchandise +28

Export of services plus seven

Import of merchandise +35

Importation of services

Investing inflows +5

+8 Capital outflows

Based on the preceding data, we can conclude that A. the visible trade deficit has increased in Year 2.

B. the visible trade deficit has decreased in Year 2.

In Year 2, the deficit in the balance of payments has increased.

In Year 2, the deficit in the balance of payments has decreased.

9.

Which of the following should be considered when calculating Hong Kong's current account balance?

A. A Hong Kong-based company pays interest on loans from a British bank.

A Hong Kong resident buys a new apartment in Shenzhen.

C. A U.S. investor purchases 5,000 Tracker Fund of Hong Kong units.

D. A Hong Kong author sells the copyright to his new book to a Taiwanese publisher.

10.

Which of the following should be included in the current account calculation for Hong Kong?

A. A foreigner purchases stock issued by a local real estate developer.

A foreigner receives rental income from his Hong Kong property.

A Hong Kong-based company donates medical supplies to a hospital in mainland China.

A U.S. manufacturer establishes a factory in Hong Kong.