1. WHAT IS THE MAXIMUM AMOUNT YOU WOULD PAY FOR AN ASSET THAT GENERATES AN INCOME OF $150,000 AT THE END OF EACH YEAR IF THE OPPORTUNITY COST OF USING THE FUND IS 9 PERCENT? (5 marks) 2. SUPPOSE THAT THE TOTAL BENEFIT AND TOTAL COST FROM AN ACTIVITY ARE, RESPECTIVELY, GIVEN BY THE FOLLOWING EQUATIONS: (15 marks) B(Q) = 150 + 28Q - 502 C(Q) = 100 + 8Q NOTE : MB(Q) = 28 - 10Q MC(Q) = 8 A. WRITE OUT THE EQUATION FOR THE NET BENEFIT. B. WHAT ARE THE NET BENEFIT WHEN Q = 1? AND WHEN Q = 5? C. WRITE OUT THE MARGINAL NET BENEFITS. D. WHAT ARE THE MARGINAL NET BENEFIT WHEN Q= 1 AND WHEN Q = 5? E. WHAT LEVEL Q MAXIMIZES NET BENEFIT? 3. A FIRM'S CURRENT PROFIT ARE $550,000. THESE PROFITS ARE EXPECTED TO GROW INDEFINITELY AT A CONSTANT RATE OF 5 PERCENT. IF THE FIRM'S OPPORTUNITY COST OF FUND IS 8 PERCENT, DETERMINE THE VALUE OF THE FIRM. (10 MARKS) SECTION B. ESSAY 4. INCOME ELASTICITY OF DEMAND HAS VARIOUS APPLICATION. EXPLAIN EACH APPLICATION WITH THE HELP OF AN EXAMPLE. (30 marks) 5. EXPLAIN THE NATURE AND SCOPE OF MANAGERIAL ECONOMIC (20 marks) GUIDELINES: - DEFINE MANAGERIAL ECONOMIC, NATURE OFMANAGERIAL ECONOMIC AND SCOPE. GIVE EXAMPLE, GRAPHICAL EXPLAINATION WRITING REQUIREMENT NO OF PAGES = MINIMUM 5 PAGES FONT = TIMES NEW ROMAN, SIZE 12, SPACING = 1.5 SPACING INSTRUCTIONS: Please read all instructions and information carefully. You are required to submit your work within the submission time given. Your assignment must be handed to the lecturer, both hardcopy and softcopy with an accurately and clearly completed