Question 1 (a) The quantity demanded of Lady Pink apples decreased by 20 percent after a recent price change. However, the total revenue of apple did not change. Is the demand curve elastic or inelastic? Explain. [2 marks] (b) The following table presents the labour input required per unit of each of the two commodities in Malaysia and Indonesia: Table 1. Number of labour hours required to produce one unit (i) If Malaysia and Indonesia decide to exchange durian and coconut, what is the pattern of trade? (ii) What is the range for mutually beneficial trade for 8kg of coconuts? [2 marks ] (c) Demand and supply of a particular market are given by Q=5002P and Q=200 respectively (i) Suppose a per-unit tax is imposed. Who bears the greater burden of the tax, buyers or sellers? [2 marks] (ii) Suppose the government is thinking of imposing a price floor of $100 in this market. What is the effect of this policy on the market if it is enacted? What is the price and quantity sold after the new policy? Show how you derive the answers. Question 1 (a) The quantity demanded of Lady Pink apples decreased by 20 percent after a recent price change. However, the total revenue of apple did not change. Is the demand curve elastic or inelastic? Explain. [2 marks] (b) The following table presents the labour input required per unit of each of the two commodities in Malaysia and Indonesia: Table 1. Number of labour hours required to produce one unit (i) If Malaysia and Indonesia decide to exchange durian and coconut, what is the pattern of trade? (ii) What is the range for mutually beneficial trade for 8kg of coconuts? [2 marks ] (c) Demand and supply of a particular market are given by Q=5002P and Q=200 respectively (i) Suppose a per-unit tax is imposed. Who bears the greater burden of the tax, buyers or sellers? [2 marks] (ii) Suppose the government is thinking of imposing a price floor of $100 in this market. What is the effect of this policy on the market if it is enacted? What is the price and quantity sold after the new policy? Show how you derive the answers