Question

Using demand and supply analysis, illustrate how each of the following scenarios would affect the equilibrium price and quantity in the respective markets. The use of carefully labelled diagrams is required with an explanation. a. The introduction of a new technology reduces the cost of production for all firms in the computer market. b. A strong advertising campaign has caused the consumer to demand more Pepsi at every existing price. c. The passage of Dorian a category 5 hurricane destroys fifty percent of the carrot crop. Question 2 (a) Consider a demand curve in the form Qd = 20 – 2p where Qd is the quantity demanded of a good and P is the price of the good. Additionally consider a supply curve of the form Qs = 2p – 4 where Qs, is the quantity supplied. At what values of P and Q do these curves intersect. b) Now suppose at each price individual’s demand four more units of output, that is the demand curve shifts to Qdd = 24 – 2p. At what values of P and Q does the new demand curve intersect the supply curve identified in part (a) c) State and explain three factors that can cause the demand curve to shift from Qd to Qdd. 1. Define the terms Politics, Political Economy and political ideology? 2. Try to identify the ideology (Marxism, Socialism, Liberalism, Conservatism or Fascism) behind the system of public management in your own country and have a brief discussion among your peers.

Answer #1

1. Consider a demand curve of the form QD = 40 - 2P, where QD is
the quantity demanded and P is the price of the good. The supply
curve takes the form of QS = -4 + 2P, where QS is the quantity
supplied, and P is the price of the good. Be sure to put P on the
vertical axis and Q on the horizontal axis. a. What is the
equilibrium price and quantity? Draw out the supply...

Using aggregate supply and demand analysis, discuss how the
following will affect the aggregate level of output and the price
level in the economy. Use a SRAS curve. You need to determine
whether the AD or SRAS curve will shift, in which direction it will
shift, and how this will affect aggregate output and the price
level.
a. A hurricane that destroys half the supply of goods produced
in Florida.
b. An increase in the money supply.

Using the information below answer the following
questions.
If demand is :Qd = 800 - 5 P and supply is: Qs = 125
+ 15 P
Where: Qd = quantity of the good demanded.
Qs = quantity of the good supplied.
P = price of the good.
Part 1: The equilibrium price is ______
Part 2: The equilibrium quantity is _________
Part 3: An imposed price of 20.25 yields an excess
(demand/supply) of _____ units
Part 4: Assuming...

Question 2. The market supply and demand curves for a product
are:
QS=0.5P (supply curve)
QD=60–2P (demand curve)
where Q is the quantity of the product and P is the market
price.
(1). Calculate the equilibrium price, equilibrium quantity and
total social welfare. (10 points)
(2). Suppose that the market has changed from a perfectly
competitive market to a monopoly market, calculate the new
price–output combination and the total deadweight loss in the
monopoly market. (10 points)

The demand and supply for a good are respectively QD = 16 – 2P +
2I and QS = 2P – 4 with QD denoting the quantity demanded, QS the
quantity supplied, and P the price for the good. Suppose the
consumers’ income is I = 2. 6) Determine the price-elasticity of
demand if P = 2. 7) Determine the income-elasticity of demand if P
= 2. 8) Determine the price-elasticity of supply if P = 4. 9)
Determine consumers’...

Question A1
(a) Answer the following questions by using demand and supply
analysis for the market of printer.
(i) Suppose the production of printer is now
completely-automated. Use the demand and supply analysis to explain
how it affects the market of printer. What are the effects on the
equilibrium price and equilibrium quantity of printer? No diagram
is needed but you need to describe how the curve(s) shift(s).
(ii) Suppose the price of ink for printers increases
substantially recently. Use...

3. Market demand for a good is given by QD= 30- 2P and its
market supply is given by QS=P - 6.
(a) Determine the market equilibrium quantity (QM) and price
(PM) .
(b) If marginal external benefit is 3 at all levels of
consumption (i.e. MEB=3), then what is the socially efficient level
of production (Q*)?
-Provides some work to justiy your answers.

Suppose that a market is described by the following supply and
demand equations:
QS = 2P
QD = 400 - 3P
Solve for the equilibrium price and the equilibrium
quantity.
Suppose that a tax of T is placed on buyers, so the new demand
equation is
QD = 400 – 3(P+T)
Solve for the new equilibrium. What happens to the price
received by sellers, the price paid by buyers, and the quantity
sold?
Tax revenue is T x Q. Use...

A market is described by the following supply and demand
curves:
QS = 2P
QD = 400 - 3P
Solve for the equilibrium price and quantity.
If the government imposes a price ceiling of $70, does a
shortage or surplus (or neither) develop? What are the price,
quantity supplied, quantity demanded, and size of the shortage or
surplus?
If the government imposes a price floor of $70, does a shortage
or surplus (or neither) develop? What are the price, quantity...

1. Demand and supply curves can be represented with equations.
If Qd = 90 - 2P and Qs = P, then equilibrium price P* and
equilibrium quantity Q* are
a. P* = 30, Q* = 60
b. P* = 60, Q* = 30
c. P* = 30, Q* = 30
d. P* = 60, Q* = 60
2.
Suppose that scientists find evidence that coffee consumption
lowers cholesterol. If so,
a. demand for coffee would remain the same
b. quantity...

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