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Urgent economics/maths help!!

Sonny68

N/A

(edited 4 years ago)

Reply 1

tomftutor

Original post by Sonny68

Hey guys, I need help with 2 questions really urgently. These are economics based mathematics questions.

1) Given the consumption function:

C = 100 + 2√ y

Where:

C: total consumption (Billion $)
Y: national income (Trillion $)

What is the value of the marginal propensity to consume when Y = 2.89?
(Round your answer to two decimal places)

2) If fixed costs are 4, variable costs per unit are 1 and the demand function is:

P = 10 - 2Q

What is the profit maximising quantity? (Answer to two decimal places)

What’s the part you can’t do? And are consumption and income meant to be in billions and trillions respectively?

(edited 4 years ago)

Reply 2

ABCBAA

A hint for the first part - to calculate marginal propensity to consume, I think you'd need to differentiate the consumption function with respect to Y.