To produce cooking oil, producers use one type of fixed cost and two types of variable cost. The cost of producing cooking oil is shown in the table below.

 K.D. Question Skills:  1. Make a supply function based on the table of cooking oil production costs above with the writing notation Qs = a + bPs if it is known that the profit desired by the producer is 25%.   

 2. Based on answer number 1, determine the new supply function if the following data is known. a. Subsidies of 2.75  

3. Determine the market equilibrium from the interaction between supply (answer number 1) and demand if the demand function is known as follows.  a. Qd = 60 - 2Pd  

4. Calculate the consumer surplus and producer surplus from problem number 3.   

5. Draw a balance curve based on answer number 3.   

6. Calculate the magnitude of the elasticity of demand and the type of elasticity of demand from the following demand function.  a. Qd = 14 - 1Pd Sorry for bad formatting, here's the question with better formatting: https://docs.google.com/spreadsheets/d/1fAARWuIbK2qv_hVXhbMVltyhHwmJahfaphdX1nU6vRI/edit?usp=sharing

Transcribed Image Text:

QuantitiesFixed CostVariable Cost Variable Cost 2 0 2 4 6 8 10 16 16 16 16 16 16 0.0 0.3 0.6 0.9 1.2 1.5 0.0 0.5 1.0 1.5 2.0 2.5 QuantitiesFixed CostVariable Cost Variable Cost 2 0 2 4 6 8 10 16 16 16 16 16 16 0.0 0.3 0.6 0.9 1.2 1.5 0.0 0.5 1.0 1.5 2.0 2.5

Answer rating: 100% (QA)

1 Supply Function The supply function represents the relationship between the quantity supplied Qs of cooking oil and its price Ps To derive the suppl... View the full answer