Part A: Tracy, Dave and Tony run the only restaurant in town which has been doing well due to the mining boom. Tracy wants to sell as much food as possible without losing money. Dave wants the restaurant to bring in as much revenue as possible, while Tony wants to make the largest possible profit. Show the price and quantity combinations favoured by each of the three partners using a simple diagram of the restaurant's demand curve and cost curves.
Part B: Suppose that about 50% of the working population in the town referred to above left the town due to the end of mining boom. Explain the possible effects of this on the business run by Tracy, Dave and Tony using a suitable graph.
NOTE: I HAVE ANSWERED THE PART A BUT HAVING TROUBLE WITH PART B. PLEASE FIND THE ATTACHEMENT FOR MY ANSWER FOR YOUR REFERENCE FOR PART B.
Part C:
"Drink driving and smoking impose a heavy toll on public health expenditure and loss of lives. The government is contemplating on implementing the following two policy measures to curb health expenditure and loss of lives resulting from drinking":
(i). Increase the legal drinking age from 18 to 21 years
(ii). Increase the price of Cigarettes by 50% from $40.00 per standard packet of 20. Briefly discuss, using suitable graphs, the impact of each of these policy measures on the market for the respective products. Comment on whether each of them would help achieve intended objectives.
Additional notes:
- Each part has a word limit of 500 words, part A is not required to be answered and happy to have feedback for my answer.
- prescribed text book for your reference "Layton, A., Robinson, T., Tucker, I., (2016) Economics For Today Fifth Asia Pacific Edition. South Melbourne, Vic., Australia: Cengage Learning"
- each part requires graphs and brief explanation.