ECON302 Economics

Question 1  A one-time ticket to go to a Bruno Mars concert costs $75, but you can go two nights for $125. What is the average cost per concert for the two-concert ticket? What is the marginal cost of the second concert? What is the total  cost of just the  second concert? Question 2: Suppose that a product supplier’s supply curve (not the market demand curve) for the product is as follows: At $20, the supplier will supply 1 unit; at$30, they will supply 2 units; at $40, they will supply 3 units; at $50, they will supply 4 units; at $60, they will supply 5 units. Required: (a) If the price of the product is $40, draw the equilibrium, and show but don’t calculate   the producer surplus (not the consumer surplus) (b) If the price of the product rises from $40 to $50, (i)   draw  the new  equilibrium , and  (c) Is the producer surplus higher or lower or the same if the price of the product rises to $50 ? (draw but don’t calculate) ,and (d) Would you expect there to be a supply gap or a consumer gap at a price of $50? Explain and show the gap on a graph. Question 3 If a 10% rise in the price of coffee increases the quantity of tea demanded by 25% and  decreases the quantity of coffee demanded by 20%: (i) what would you call the coffee and tea products? (ii) calculate the  cross elasticity of demand between tea and coffee, and (iii) calculate the same product  elasticity of demand for coffee