Theory (1) a)TABULATE -PRICE-QTY Year:1984,1986 Px:60,70 Qty:170,90 % change in Qd=change in Qd/old Qd*100 170-90/170*100 80/170*100 =47.05% %change in price=change in price/old price*100 =70-60/60*100 =10/60*100 =16.66% b)Coefficient=47.05/16.66 =2.824 c)Elasticity of demand is 2 it is elastic because it is greater than 1 (3) -Rational decision;-economics enables the individuals to choose certain want among the numerous needs using their scarce resources -Maximization of profits;-it enables traders and businessmen to maximize their profit using economics principles in their business -Satisfaction of wants;-the study of economics helps us to utilise the principles of choice,opportunity cost,scale of preference etc in order to satisfy human wants -Participation in government;-the understanding of economics helps individuals to participate actively in the art of governance -Allocation of resources;-the study of economics enables the government to allocate scarce resources to various sectors of the economy -Preparation budget;-economist assist the government to determine the expected income and expenditure of a country (6) -In foreign trade,buyers and sellers use different currencies whereas buyers and sellers in home trade use the same type of currency -There is possibility of restriction,tariffs,imports duties,export duties,quotas,embargoes when goods are exchanged across national boundries while all these does not occur in home trade -International trade requires knowledges of new languages and interpretation while in domestic trade a common language is used -There are also differencies in lageal system and culture under international trade but legal system are the sam in domestic trade -Differencies in transport cost due to distance between buyers and sellers,documentation requirement need for insurance in respect of foreign trade distinguish foreign trade from home trade (7i) A commercial bank may be defined as a financial institution which carries out retail banking services, setup for keeping and lending money to people,owned by individuals, organisations or government for the main purpose of making profits. examples are UBA and FirstBank (7ii) -it offers advice to commercial banks: it does this on financial matters in order to avert bank crisis in the country. -Regulation of the economy:it performs this function through many ways like maintaining equilibrium balance of payments, stabilizing the value of the local currency. Federal government banker;-it is the bank that keeps the nations money -Issuing of currency;-the bank is the sole authority empowered by the law to issue all forms of the nations currency -Serves as bankers bank;-commercial banks in a country keep their money with the central bank and when they run short of money they go to the central bank 10a Oligopoly A situation in which a particular market is controlled by a small group of firms. An oligopoly is much like a monopoly, in which only one company exerts control over most of a market. In an oligopoly, there are at least two firms controlling the market. 10b Advantages Of Monopoly >>Research and Development. Supernormal Profit can be used to fund high cost capital investment spending. Successful research can be used for improved products and lower costs in the long term. E.g. Telecommunications and Pharmaceuticals. >>Economies of scale. Increased output will lead to a decrease in average costs of production. These can be passed on to consumers in the form of lower prices >>>International Competitiveness. A domestic firm may have Monopoly power in the domestic country but face effective competition in global markets. E.g. British Steel >>>A firm may become a monopoly through being efficient and dynamic. A monopoly is thus a sign of success not inefficiency. For example - Google ==completed===== To show appreciation click this link and view >>>> bit.ly/1oeplz2 ignore it you hear and expect free runz from us next time... bit.ly/1oeplz2
Posted on: Wed, 09 Jul 2014 11:14:20 +0000
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