A local sandwich shop faces the following costs of production per hour depending on how many sandwiches it makes.

Suppose that the market for sandwiches is perfectly competitive. If the market price of a sandwich is $3.50, the shop will make sandwiches per hour.

Suppose there is a flood that damages the iceberg lettuce crop. At the same time, there is a 20% off sale for spinach, a substitute for iceberg lettuce. 

What will happen to the equilibrium price and quantity of iceberg lettuce following these two events?

Suppose that Ron and Karen have a boutique bakery where they make only cakes and biscuits. Their daily productivity is reported in the table below.

Ron’s opportunity cost of producing a kilogram of cake is kg of biscuits.

Suppose the smell from Paula and Dean’s baking is causing tummies to rumble. The private market for pies is given by: 

Demand: P = 36 – 2Q 

Supply: P = 3 + Q 

The delicious scent in the air is creating an external benefit of $6 per pie. 

The table below gives the amount of time in minutes it takes

Paula and Dean to produce the crust and pie filling for one pie.

Working together, what is the most pies Paula and Dean can

produce in an 8-hour day?

Suppose that demand for coriander is given by: 

P = 16 – 0.5Q 

1. Calculate the price elasticity of demand (PED) for coriander at $10. 

Note: Please report a positive number and round to two decimal places. 

Choose Carroll’s (1979) four indicators of corporate social performance.

Consider the tutorial case study provided in Week 4: 

According to the Australian Competition and Consumer Commission (ACCC), the lack of effective competition in Australia’s domestic airline industry may NOT result in the following:

Rajah agrees with Lakshmi for valuable consideration to employ Michael as an auditor. Rajah fails to do so and employs another auditor, Toby instead. What rights (if any) do Lakshmi and Michael have against Rajah?