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BUS702 - Economics for Managers Assignment

   

Added on  2020-05-01

9 Pages1073 Words78 Views
Running head: ECONOMICS ASSIGNMENTECONOMICS ASSIGNMENTName of Student:Name of University:Author Note:
BUS702 - Economics for Managers Assignment_1
1ECONOMICS ASSIGNMENTANSWER-1:Own price elasticity refers to the changes in demand due to change in its own price can be defined by, Ed = %change∈quantiydemanded%change∈priceValue of E implies whether demand is elastic (E>1), inelastic (E<1) or unitary elastic (E=1) that further helps in measuring the responsiveness of the consumers. From the given cross price elasticity data it is evident that milk, fruits and vegetables of high calories has elastic demand whereas sugary snacks have inelastic demand. This clearly signals the government about what could be the results of changing price of the unhealthy foods as well as healthy foods if tax or subsidy is imposed. Consumption of unhealthy food increases the risk of more health issues that calls for more of government expenditure in that sector. To curb that and ensure overall good health, government can impose tax on sugar based junks or subsidy on healthy foods. The per unit subsidy given on fruits and vegetables make their prices apparently lower which increases the purchasing power and consumption as well due to elastic demand that explains that demand
BUS702 - Economics for Managers Assignment_2
2ECONOMICS ASSIGNMENTSDPQQGovt. sets price ceiling in and rest is paid as subsidyOABwould rise by more than one unit for one unit fall in price.(Source: Author)
BUS702 - Economics for Managers Assignment_3

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