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Author Topic: need help in economics AS question  (Read 6678 times)

Offline twilight

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Re: need help in economics AS question
« Reply #30 on: June 09, 2009, 03:15:00 pm »
here's 1 more ..
i know that if the tax is imposed the supply curve wud shift to the left (so it can b either A or B )
The marking scheme shows the answer as A (that is .. the supply becomes more inelastic also)
why duz the elasticity change here?
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Offline Priya

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Re: need help in economics AS question
« Reply #31 on: June 09, 2009, 04:37:01 pm »
@twilight

There are 2 type of taxes:
(i) Ad Valorem taxes which add a certain percentage on price. (pivots the ss curve to the left)
(ii)Specific taxes which add a fixed amount of money onto costs. (shifts ss curve parallel to the left)

Refer to the attached diagrams
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Offline twilight

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Re: need help in economics AS question
« Reply #32 on: June 09, 2009, 04:39:27 pm »
ohhhh .. so do u mean that .. since its ad valorem .. then as the price rises the tax rises ?
thanks sweetyyyy

can i ask sum more questions?
« Last Edit: June 09, 2009, 04:47:59 pm by twilight »
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Offline Priya

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Re: need help in economics AS question
« Reply #33 on: June 09, 2009, 04:47:33 pm »
Yes, since it's a percentage... As price rises, the amount of tax imposed of the good rises, thought the percentage of the tax is still constant.

For example, a 10% tax on the good,
Price - 10, amount of tax - 1
Price - 12, amount of tax - 1.2
Price - 14, amount of tax - 1.4

The increase in tax shifts the ss curve further as opposed to a specific amount of tax.

You can ask more questions, though I cannot say for sure I'll know the answers...
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Offline twilight

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Re: need help in economics AS question
« Reply #34 on: June 09, 2009, 04:50:38 pm »
ohhh .. thanksss ..
am sure u'll b able 2 ..  ;) :-*
here .. i've attached it .. can u tell me how u approach the answer?
« Last Edit: June 09, 2009, 04:52:28 pm by twilight »
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Offline Priya

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Re: need help in economics AS question
« Reply #35 on: June 09, 2009, 04:52:57 pm »
...
« Last Edit: June 09, 2009, 05:05:38 pm by Priya »
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Offline twilight

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Re: need help in economics AS question
« Reply #36 on: June 09, 2009, 04:59:07 pm »
thses too plz
sorry am asking too much
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Offline astarmathsandphysics

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Re: need help in economics AS question
« Reply #37 on: June 09, 2009, 04:59:53 pm »
It was at the lowest at the start. The percentages aree only the rate of increase. the price level is always increasing but the rate of increase is slowing
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Offline twilight

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Re: need help in economics AS question
« Reply #38 on: June 09, 2009, 05:01:23 pm »
Quote from: astarmathsandphysics on June 09, 2009, 04:59:53 pm
It was at the lowest at the start. The percentages aree only the rate of increase. the price level is always increasing but the rate of increase is slowing
okiiiiii ... get itttt .. thanks astar  :-* +rep
and u too priya +rep
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Offline astarmathsandphysics

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Re: need help in economics AS question
« Reply #39 on: June 09, 2009, 05:03:13 pm »
Quote from: twilight on June 09, 2009, 04:59:07 pm
thses too plz
sorry am asking too much

b since the % increas from 112 to 257 is the biggest
c since exports will become cheaper hence more will be exported
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Offline twilight

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Re: need help in economics AS question
« Reply #40 on: June 09, 2009, 05:06:29 pm »
Quote from: astarmathsandphysics on June 09, 2009, 05:03:13 pm
Quote from: twilight on June 09, 2009, 04:59:07 pm
thses too plz
sorry am asking too much

b since the % increas from 112 to 257 is the biggest
c since exports will become cheaper hence more will be exported

hmmm . so the first 1 duznt hav anything 2 do with the money supply?
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Offline Priya

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Re: need help in economics AS question
« Reply #41 on: June 09, 2009, 05:09:43 pm »
Quote from: twilight on June 09, 2009, 05:06:29 pm
Quote from: astarmathsandphysics on June 09, 2009, 05:03:13 pm
Quote from: twilight on June 09, 2009, 04:59:07 pm
thses too plz
sorry am asking too much

b since the % increas from 112 to 257 is the biggest
c since exports will become cheaper hence more will be exported

hmmm . so the first 1 duznt hav anything 2 do with the money supply?

No, Inflation - price level
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Offline twilight

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Re: need help in economics AS question
« Reply #42 on: June 09, 2009, 05:10:25 pm »
Quote from: Priya on June 09, 2009, 05:09:43 pm
Quote from: twilight on June 09, 2009, 05:06:29 pm
Quote from: astarmathsandphysics on June 09, 2009, 05:03:13 pm
Quote from: twilight on June 09, 2009, 04:59:07 pm
thses too plz
sorry am asking too much

b since the % increas from 112 to 257 is the biggest
c since exports will become cheaper hence more will be exported

hmmm . so the first 1 duznt hav anything 2 do with the money supply?

No, Inflation - price level

so we dont use the money supply values given in the table?
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Offline astarmathsandphysics

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Re: need help in economics AS question
« Reply #43 on: June 09, 2009, 05:13:36 pm »
No only the price index. The money supply take time to affect the price index. Typically longer than 6 months.
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Offline twilight

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Re: need help in economics AS question
« Reply #44 on: June 09, 2009, 05:25:08 pm »
okzzz .. thanks dude !!! :-*
 i wanna ask a question about BOP
when do we credit and wen do we debit??
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