QUESTION 1 The following data shows the relationship between price and quantity demanded at four different prices for a product: P = RM 11, Qa = 16 P = RM 9, Qa = 24 P = RM 7, Qd = 32 P = RM 5, Qa = 40 Using the midpoint formula, what is the price elasticity of demand between: (a) RM 11 and RM 9 (b) RM 9 and RM 7 (c) RM 7 and RM 5 QUESTION 2 Explain the statement: "Clean air and water have become increasingly scarce and valuable resources because they have been treated in the past as if they were free and unlimited in supply." What methods might be used to internalize spillover costs? QUESTION 3 The following table shows the quantity of labour used at various levels of production in a firm. Quantity of Total Marginal Average Total Marginal Average labor output product product of variable cost variable employed of labor labor cost cost 0 0 1 10 10 10.00 22 12 11.00 36 14 12.00 48 12 12.00 58 10 11.60 6 66 8 11.00 72 8 6 10.28 9 76 4 78 9.50 2 8.66 78 0 7.80 a. Calculate the average production and marginal production at each level of labour. b. Using graph paper, draw the total production, average production and marginal production curves for each level of labour