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A firm makes two goods A and B using the three inputs X, Y and Z. What combination of A and B should it produce to maximize total profit?
Discuss what mix of X and Y should the firm use to minimize the cost of a load of the final product?
The firm is under contract to produce a minimum of 6 units of B. How many units of A should it make to maximize profit?
A parent invests £6,000 for a 7-year-old child in a fixed interest scheme which guarantees 8% interest. How much will the child have at the age of 21?
What will £24,000 invested at 11% be worth at the end of 5 years? How much will an investment of £3,000 be worth at the end of 6 years?
A sum of £450,000 is invested at a monthly interest rate of 0.6%. What will the final sum be after 18 months? What is the corresponding AER?
If £1,600 is invested at a quarterly rate of interest of 4.5% what will the final sum be after 18 months? What is the corresponding AER?
How much interest is earned on £50,000 invested for three months at a nominal annual interest rate of 5%?
You need to have £7,500 on 1 January next year. How much do you need to invest at 1.3% per month if your investment is made on 1 June?
How much do you need to invest now in order to earn £25,000 in 10 years' time if the interest rate is (a) 10% (b) 8% (c) 6.5%?
If it can earn 9.5% interest, how long would any given sum of money take to treble its value? How long will £70,000 take to accumulate to £100,000?
What monthly rate of interest must be paid on a sum of £2,800 if it is to accumulate to £3,000 after 8 months?
At what rate of interest will £600 accumulate to £900 in 5 years? Calculate the NPV and say whether or not each is a worthwhile investment.
Why Is this project a worthwhile investment if the going rate of interest is (a) 9%, (b) 10%?
In the geometric series below (i) identify the constant ratio, (ii) say what the sixth term will be and (iii) calculate the sum of each series up to ten terms.
It sells 420 units in January and then sales increase by 10% each month. What will total demand be in the last 6 months of the year?
What would be a reasonable price to pay for a pension plan which guarantees to pay £200 a month for next 2 years if you can earn 1.2% a month on your account?
What is the maximum price you would pay for a perpetual annuity that will commence annual payment of £400 in 12 months' time if market rate of interest is 13%?
What would you calculate the price of an annuity paying £12,000 per annum to be if the market rate of interest is (a) 5%, (b) 10%, (c) 15%, (d) 20%?
What will be the monthly repayments on a loan of £6,500 taken out over 5 years at a monthly interest rate of 1.2%?
What will be the monthly payments on a repayment mortgage of £75,000 taken out over 20 years if the interest rate is fixed at 0.95% per month?
An economist researching the market for tea. What does Qt = f(Pt, Y, A, N, Pc) mean in words? Identify the dependent and independent variables.
A monopoly sells 30 units of output when price is £12 and 40 units when price is £10. What domain restrictions would you put on this demand function?
If the actual price in Turkey costs more lira than the answer you found in part (b), how might you account for the discrepancy?
If you decide to exchange these pesos for dollars, does your action shift the supply of pesos?