Essay about Business Economics Questionnaire and Answers
Assignment - 2
Q 1) Consider the following demand function: 5P=-Q+46 and the following supply
(a) What is the equilibrium price and quantity?
(a) At equilibrium level: Qd = Qs
The equilibrium price is Rs 6 and the equilibrium quantity is 16.
(b) Suppose that the demand function shifts to right such that the new demand
equation now becomes: 5P=-Q+55. What is the new equilibrium price and
(b) At equilibrium level: Qd = Qs
The equilibrium price is Rs 7 and the equilibrium quantity is 20.
0 0 420 420 - - -
10 100 520 420 10 52 100
20 180 600 420 9 30 80
30 240 660 420 8 22 60
40 280 700 420 7 17.5 40
50 350 770 …show more content…
little imperfect Information. That means
that the buyers and sellers do not have
complete information of the market.
Monopolistic Competition uses
advertising to shift the demand in the
In Oligopoly market there is slight
Oligopoly market uses very little
advertising to create demand in the
Monopolistic Competition Oligopoly
In Monopolistic Competition the firm is
In Monopolistic Competition Maximum
Profits are attained when the marginal
revenue is equal to marginal cost.
Oligopoly market uses Game Theory
to set Price in the market.
In Oligopoly market maximum Profit
is attained when marginal revenue is
equal to marginal cost.
(b) Explain the concept of diversification in detail and differentiate between
Horizontal and Vertical Diversification with suitable examples
Diversification is a strategy that takes an organization into new markets with new
products or services. Organizations may pick a diversification strategy for distinctive
Firstly, organizations may wish to make and endeavor economies of scope, in which
the organization tries to use its energizing resources and proficiencies in different
markets. This can regularly be the situation if organizations have under-used resources
or capacities that can't be effectively arranged or shut. Utilizing a diversification