You want an investment of 33% from the total amount of Rs. 5, 50,000/- to a saving

certificates. The interest rate is 8%, compounded quarterly for the two years. What is the total

amount of interest and interest rate over the 2-year.

b) Suppose that the demand and supply functions for good X are

Qd = 50-8P

Qs = -17.5+ 10P

i) What is the market outcome if price is Rs. 2.75? What do you expect to happen?

Why?

ii) What is the market outcome if price is Rs. 4.25? What do you expect to happen?

Why?