Principles of Microeconomics (ECNC2101)
Higher Institute of Commerce and Management (HICM)
Semester: First Semester
Level: 200
Year: 2016
THE UNIVERSITY OF BAMENDA
Higher Institute of Commerce and Management
(HICM Level 1)
TD SET ONE 2017
Principles of Microeconomics, course code: ECNC 102, Time Allowed:1H
Examiner: Dr NDAMSA / Mr Kifen
Question 1
The government can sometimes control prices of goods and services and such price controls usually
below or above the market price Explain with the aid of graphs the following intervention policies
-
Maximum price policy
-
Minimum price policy
Question 2
Given the following demand and supply schedules for toy watches per week in the “Bambui market”.
Price
Quantity Demanded
Quantity supplied
500
3000
6000
600
2000
8000
a)Derive the demand and supply functions for toy watches (3 marks)
b) Determine the equilibrium price and quantity for toy watches in the “Bambui market" (2 marks)
c) What are the economic implications in the market for toy watches at “Bambui” if the price increases
above the equilibrium price and if it decreases below the equilibrium price? Use graphs to support your
answer (3 marks)
d) Define and calculate the price elasticity of demand for toy watches Interpret your result (2 marks)
Question 3
In the "food market" suppose we have the following market demand and supply curve tor a commodity
= 1000 - 10P and
= 50 + 25P
a) Determine the equilibrium price and quantity
b) Determine the inverse form of the demand curve
c) Calculate the price elasticity of demand at the market equilibrium
d) Suppose the price m the market is 25 FCFA. What is the amount of excess demand
www.schoolfaqs.net
www.schoolfaqs.net
