Economics questions

Presentation 3:
Slide 36: What is demand response?

Q=f ( P ) , in other words, quantity demanded is a function of price and it

depends on the price and not the other way around, thus quanitity
responds to price.

Slide 50: Lets assume the income elasticity of fuel worldwide is large What are
the consequences of economic growth on the environment?
Income elasticity is how quantity demanded changes with your change in
income, high income elasticity meaning as you get more money you buy
more of that good,the consequences on the environment would be bad
because as people get more money they will buy more fuel
How may the income elasticity of fuel compare between EU, Malawi?
In the EU fuel is mostly a luxury thing thanks to the development of public
transport however in a place like Malawi, people would need fuel to
survive and move long distances as public transport there is very poorly
developed. So in the EU an increase in income wont necessarily mean that
they will buy more fuel, however an increase in income in Malawi would
mean that they will buy a lot of fuel due to its importance to them.
Slide 51: Suburban greenbelts and property tax revenues Local government may
want to create suburban greenbelts, on the other hand, this may decrease property
tax revenues Will tax revenues (P*Q) increase or decrease? Why? (Theres a
diagram)
No idea
Presentation 4:
Slide 14: Why does the S curve start from that point of S2 curve?
We have two companies in this market. Company 1 (S1) will not start
producing until the price stays high (notice how the S1 crosses with high
price in the Y axis) however S2 is accepting less prices for his goods so
until the good he is producing reaches the price that S1 wants, he is only
alone in the market, but after a certain price, S1 and S2 will start
producing together, and that red line represents the production of S2 and
S1 together.
Slide 32: What is the effect on the fuel price? Who gets the benefits from this
policy?

The producer gets most benefit, because the before sales tax is equal to P1-tax
previously and after sale tax is equal to P1 in this graph, when the government
removed the tax. The producer actually is not selling at P1-tax as he is supposed.
He is using this opportunity to sell at a price which is lower than P1 but much higher
than the P1-tax
Presentation 5:
Slide 52: Market for video games Demand: MB = 30 - 2/3*Q Supply: MC = 10 Net
benefits with and without tax????? Deadweight losses (75)? Tax (10)?

Presentation 6:
Slides: 7,8,9,.TASK 17,21 - Are we going to get similar task at the exam; isnt it a
bit too long or difficult?

Presentation 7:
Slides 9 and 10: Is the right answer only Inflation or everything?
Slides 28, 33, 34: Do we need to know formulas of CPF, production possibility curve,
optimal consumption path?

Presentation 8:
Slides 11 and 12: The example (task + table) were not done at the lectures, do we
need to learn that for the exam?