ECO401 Assignment No 1 Solution Fall 2018

ECO401 Assignment No 1 Fall 2018

Dear Students, Here you can read or Download Economics ECO401 Assignment No 1 Solution of Semester Fall 2018. Assignment Due Date is 22 November, 2018. Total Marks are 10. We are here to facilitate your learning and we do not appreciate the idea of copying or replicating solutions. ECO401 Assignment Solution File has been added. Previously we shared CS302 Assignment No 1 Solution Fall 2018.

ECO401 Assignment No 1 Solution and discussion Fall 2018

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ECO401 Assignment Question

The Case:

Fertilizer Industry of Pakistan has shown remarkable growth in year 2017-2018.
Presently, more than 14 factories are producing different types of fertilizers such as urea, calcium ammonium nitrate, ammonium phosphate and nitro phosphate.
Fertilizers provide good source of nitrogen to the cultivated soil.Local production of high-grade fertilizers has real contribution in increased agricultural productivity in considered year. Suppose market of urea fertilizer is facing the following demand and supply functions.

Demand function of urea:
Qd = 6500 – 0.5P

Supply function of urea:
Qs = 500 + 2.5P

Qd represents quantity demanded of urea, Qs is the quantity supplied of urea and P is the price of urea in the market.

Requirement:

Find equilibrium price and equilibrium quantity of urea by using the given demand and supply functions.
Consider the data given in this part and identify whether urea market is in shortage, in equilibrium or in surplus situation at different price levels.
Consider the data on prices and quantity demanded of urea given in this part and calculate price elasticity of demand if price of urea decreases from Rs. 2000 per bag to Rs. 1700 per bag. [Marks = 3+4+3]