1,A firm product two different goods, with demand give by the following Pa=100 -2Qa-Qb and Pb=90-2Qb

where Pa =Price of good A Pb=price of good B Qa =quality of good A and Qb=quantity of of good B . There are 30 unit of each good in storage(Hint: how does this impact MC) and management has decided to close out the product lines and produce no more. Determine the optimal price and quantity in each market. 2, Near by college has done a study of college enrollments and has concluded that the student has in fall term is given by 5000 -- .5T+1Y+.2TC Where Q = number of students enrolled full time, T =tuition charge by Near by Y=national GDP in billion and TC =tuition charge by competition college a school across the town Determine enrollment if T=$14000 Y=$7500billon and Tc=$16000 determine elasticity of demand for Near by at this tuition rate B, the admission office of Nearby proposes an advertising campaign design to convince potential student that it is an underrated educational bargain the cost of the campaign is set at$ 4,5 00,000 Near by admission office think that this will change demand to Q=7500-.4T+.15Y+.2TC If the admission office is correct, how many student will enrolled next semester is the advertising campaign cost effective. 7,A firm faces the demand curve P=80-3Q and has the cost equation C=200+ 20Q A, find optimal quantity and price for the firm B, now suppose that demand curve to P =110-3Q.find a new optimal price and quantity. Has there been an increase or a decrease in demand ? explain. 8 Vanders sells bicycles in a small shop on main thoroughfare, and the manager has computed some numbers based on past sales of bikes. She estimates the demand curve estimate to be P=80-2Q.Cost are given by C =200+2Q You have been asked to make decision about whether the firm should seek to maximize sale revenue. What is your recommendation? What numbers would you used to back up your decision?

4,The Dodge city bank is planning its loan for the next several years, and is using the model of loan demand developed from past experience. Fred smith is responsible for developing the mortgage loan component of total loan demand .doge city bank is the leader in the community, and other banks follow its announced rates

The model that Fred uses is the following ,estimated on 14 years of data

Qt= 50 - .2Pt (17) (.13)

.2Dt + .3Yt + .15Ht R2=.844 ( .16) ( .08) (.06)

Standard errors are in parentheses) Where Qt = mortgaged loan demand in millions of dollars in year t, Pt =prime rate in year t,Dt= discount rate in yeart,Yt= per capita income in Dodge city in year t, in thousands of dollars , and HT= average housing price in Dodge city in year t, in thousands of dollars. a. Evaluate these regression results ,including computation of t-statistics, coefficients and R2 B.Fred thinks there that the discount rate will be 6%in the year , the prime rate 7.75% per capita income in dodge city will be $21,000 and housing prices will be $65,000. How many loans can Dodge city bank expect to make in the next year? Same question 4