The manager of a company was analysing the trend of the prod

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Business Economics

Internal Assignment Applicable for December 2018 Examination

1. The manager of a company was analysing the trend of the products of its company (Commodity Y) getting replaced by another substitute product available in the market which gives the same level of satisfaction to the consumers. Calculate the rate of Marginal Rate of Substitution and analyse the result.
Combination Units of Commodity Y Units of Commodity X Total Utility
a 40 10 U
b 25 14 U
c 17 19 U
d 10 27 U
e 7 38 U
2. Neha has just completed her MBA and joined a startup company. The company was planning to launch a new product in the market so the management wanted to understand the different factors that can impact the demand and supply of their products in the market. Help Neha to prepare a report on the factors impacting demand and supply of products in the market.
3. Alpha Ltd market share was declining due to high competition in the market so it decided to enter a new segment. It wanted to determine the relationship between change in the quantity demanded of the product due to change in the price of the product in the market. Assume that at the price of 100, the demand for the product is 400 units. If the price of the product increases to 120, the demand decreases to 250 units. Calculate the price elasticity:
a) Using Arc elasticity method
b) Using Percentage method.
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