Practice Problem 1 Suppose I hire 50 workers in my factory to produce two things: books and pens. I engage 35 workers to produce books, and they make 500 books a week. I engage 15 workers to make pens, and they produce 200 pens a week. (a).If I used all my workers to make books, how many books would my factory make in a week? If I used all my workers to make pens, how many pens would my factory make in a week? (3 marks) (b).Draw a clearly labelled weekly production possibility curve of my company. (3 marks) (c).Suppose a particular type of ink is no longer available in Bangladesh and my factory has to use an inferior quality ink in production of both books and pens. What effect might this have on the factorys production possibility curve? Explain with a diagram. (4 marks) Practice problem 2 Consider the following demand and supply equations: P=20-5Q and P=10+2Q. (3 marks) (a).Draw a neatly labelled diagram showing the demand and supply curves. (3 marks) (b).Find the equilibrium level of price and quantity. (3 marks) Suppose this is the demand and supply of apples. List three factors that may change the demand for apples. Explain. List three factors that may change the supply for apples. Explain.(4 marks) (c)Suppose the price rises from the equilibrium level to 15. Calculate the price elasticity of demand and the price elasticity of supply in this range. (4 marks) (d).Comment on the value of PED and PES. Explain what we can say about the demand and supply of apples from the calculated elasticity values.(4 marks) As an apple seller, should you increase or decrease the price of apples to increase your revenue? (2 marks) (e).Calculate the consumer surplus and producer surplus in the apple market at equilibrium. (3 marks) (f).Bad harvest in parts of the world means that there is a fall in the supply of pears. What effect will this have on the market of apples? Explain with a diagram.(4 marks) (g).What happens to the consumer surplus and producer surplus in the apple market due to bad harvest of pears? (3 marks) Practice Problem 3 The price of fuel goes up from BDT 75 per liter to BDT 120 per liter. At the same time, you get a promotion at work, and you salary goes up from BDT 50,000 per month to BDT 60,000 per month. (a)Explain what you think will happen in the inter-city bus market and Uber/Pathao market due to rise in price of fuel and a rise in income. Draw diagrams. (Think about demand and supply; think about consumer and supplier preferences; think about relationship between goods and elasticity.) (6 marks) (b).Explain how different people may react differently to these changes.(4 marks)