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17 views4 pages

Proo Ass

pros

Uploaded by

legeseefa27
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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1. Define supply and state the law of supply .

Definition of Supply

Supply refers to the quantity of a good or service that producers are willing and able to offer for
sale at different prices over a given period. It is influenced by factors such as production costs,
technology, government policies, and market conditions.

Law of Supply

The Law of Supply states that, ceteris paribus (all other factors remaining constant), the
quantity of a good supplied increases as its price increases and decreases as its price decreases.
This is because higher prices provide an incentive for producers to supply more goods to
maximize their profits.

Mathematical Representation:

Qs=f(P)Q_s = f(P)Qs=f(P)
Where:

 QsQ_sQs = Quantity supplied


 PPP = Price of the good

Graphical Representation:

The supply curve is typically upward sloping, indicating a direct relationship between price and
quantity supplied.

3.Difference Between Equilibrium Price and Equilibrium Quantity

1. Equilibrium Price:
o The price at which the quantity of a good demanded by consumers equals the quantity
supplied by producers.
o It is the price at which there is no shortage or surplus in the market.
o Also known as the market-clearing price.
2. Equilibrium Quantity:
o The quantity of goods or services that is bought and sold at the equilibrium price.
o At this quantity, the intentions of buyers and sellers match, ensuring market stability.

Key Difference:

 Equilibrium Price is a monetary value (price level) at which demand and supply balance.
 Equilibrium Quantity is the number of goods or services exchanged at that equilibrium price.

Graphical Representation:
In a demand and supply graph, the equilibrium price is found at the intersection of the demand
and supply curves, and the equilibrium quantity corresponds to the quantity at that intersection.

5. To get the market supply carve for a product why are add individual supply carves
horizountlly oathr than vertically ?

Market supply curves are derived by horizontally summing individual supply curves rather than
vertically because supply represents quantities supplied at different price levels. Here's why:

1. Supply is Quantity-Based: Each firm's supply curve shows how much it is willing to
produce at different prices. To get the total market supply, we need to add up the
quantities supplied by all firms at each price.
2. Horizontal Summation: At any given price, we sum the individual firms' supply
quantities to get the total market supply. This results in a rightward shift in the market
supply curve as more firms contribute.
3. Vertical Summation Wouldn't Make Sense: If we summed supply curves vertically,
we would be adding prices instead of quantities, which is not how supply works. Market
supply depends on total quantity available at each price, not on summing different prices
together.

In short, market supply is the total quantity offered at each price level, which is why we sum
the individual supply curves horizontally.

7 write the relaetionship between MP carve and AP carve ?

The relationship between the Marginal Product (MP) curve and the Average Product (AP)
curve is as follows:

1. When MP is greater than AP, the AP curve is rising. This means that adding an
extra unit of input increases the average output per unit of input.
2. When MP is equal to AP, the AP curve is at its maximum. This is the point where AP
stops increasing and begins to decline.
3. When MP is less than AP, the AP curve is falling. This indicates that adding an extra
unit of input decreases the average output per unit of input.

Graphical Representation:

 The MP curve intersects the AP curve at AP’s maximum point.


 Before this intersection, MP is above AP, causing AP to rise.
 After this intersection, MP falls below AP, causing AP to decline.

This relationship is based on the law of diminishing marginal returns, which states that as more
units of a variable input are added to fixed inputs, the marginal product will eventually decrease.
suppply the AP of 12 workars is 300 units
9.

of food and that a14 workers is 340 units find


the MP of forteenthe worker
To find the Marginal Product (MP) of the 14th worker, we use the formula:

MPn=Total Product at n workers−Total Product at (n−1) workersMP_n = \text{Total Product at


} n \text{ workers} - \text{Total Product at } (n-1) \text{ workers}MPn
=Total Product at n workers−Total Product at (n−1) workers

Given:

 AP of 12 workers = 300 units


Total Product (TP) at 12 workers=12×300=3600\text{Total Product (TP) at 12 workers}
= 12 \times 300 = 3600Total Product (TP) at 12 workers=12×300=3600
 AP of 14 workers = 340 units
Total Product (TP) at 14 workers=14×340=4760\text{Total Product (TP) at 14 workers}
= 14 \times 340 = 4760Total Product (TP) at 14 workers=14×340=4760

Now, calculating the MP of the 14th worker:

MP14=TP14−TP13MP_{14} = TP_{14} - TP_{13}MP14=TP14−TP13

Since we don't have TP at 13 workers directly, we first find MP of the 13th worker using:

MP13=TP14−TP12−MP14MP_{13} = TP_{14} - TP_{12} - MP_{14}MP13=TP14−TP12


−MP14

To simplify, let's assume MP of the 13th worker is close to the average change between 12
and 14 workers:

MP14=TP14−TP13=4760−3600=1160MP_{14} = TP_{14} - TP_{13} = 4760 - 3600 =


1160MP14=TP14−TP13=4760−3600=1160

MP14=11602=580MP_{14} = \frac{1160}{2} = 580MP14=21160=580

Thus, the Marginal Product of the 14th worker is 580 units.


ECONOMICS ASS
SCOUND SEMESTRE GRAD 9K ASS
TO TEACHRE SHIGUTE

GROUP ONE

STUDENT NAME
S/NO

S/N FULL NAME S/N FULL NAME


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