14. The pricing systemConsider the market for hamburgers in an economy where the market equilibrium is characterized by a quantity of hamburgers of 50 million and aprice of $5.00 per hamburger.Suppose that currently 80 million hamburgers are being produced and sold at a price of $2.50. This outcome in the market for hamburgers iseconomicallybecause:The opportunity cost of producing the last hamburger equals the marginal benefit of consumption.Some hamburgers produced incur opportunity costs of production that exceed their value or marginal benefit to consumers.Which of the following must be true for a market to be able to achieve an efficient outcome? Check all that apply.Firms can freely enter or exit the market without any barriers.A ceral planner allocates limited resources according to the needs of the people.Private property rights are well-defined and enforced.Evaluate the following statement.True or False: The pricing system ensures that even the lowest-valued demands are satisfied.TrueFalse

1. Market Efficiency Analysis:The market equilibrium for hamburgers is characterized by a quantity…

Answered: 14. The pricing system Consider the…

Brief Principles of Macroeconomics (MindTap Course List)

8th Edition

ISBN:9781337091985

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter4: The Market Forces Of Supply And Demand

Section: Chapter Questions

Problem 5QR

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9. The variety of supply curves The following graph displays four supply curves (LL, MM, NN, and OO) that intersect at point V. PRICE (Dollars per unit) 200 180 160 140 120 100 80 60 40 20 0 H 0 M 20 40 60 W N X + +Y N >++N 80 100 120 140 160 QUANTITY (Units) O M 180 + 200 ?
50 Supply 45 40 35 W 30 25 20 15 Demand 10 100 200 300 400 500 600 700 800 900 1000 QUANTITY Refer to Figure 4-7. At what price would there be an excess demand of 600 units of the good? O $20 O $10 O $15 O $5 PRICE
S2 Refer to the above figure. Which diagram shows the effect on the market of cellphones when the demand for cellphones has increased? Select one: O a. graph C O b. graph D O c. neither graph O d. both graphs
Please answer Not a grade Was this change an increase or decrease? As a result did the equilibrium price and quanity increase of decrease?
Use the supply and demand schedule below to plot the supply and demand curves for tequila in this market. Tequila Price Quantity Demanded Quantity Supplied 10 100 15 70 10 20 42 22 25 12 35 30 48 What is the equilibrium price? O a 23 dollars O b 43 dollars Oc 13 dollars 33 dollars ME 国国

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3) The following figure shows the demand and supply curves for USB flash drives. D is the demand curve and S1 is the initial supply curve. Price (S) O 10 Quantity (units) 20 40 60 Refer to the figure above and answer the questions: a) When the demand curve for flash drives is D and the supply curve of flash drives is S1, the equilibrium price is with an equilibrium quantity ofunits. If the supply curve for flash drives shifts from S1 to S2, with no change in the demand curve, the new competitive equilibrium price is with a new equilibrium quantity of units. b) When the demand curve for flash drives is D and the supply curve of flash drives is S1, what is the surplus in the market if the price is $7? O When the demand curve for flash drives is D and the supply curve of flash drives is S1, what is the shortage in the market if the price is $4?
4. The following problems are based on the demand and supply schedule for gum listed below. All quantities are in millions of packs of gum per month. Quantity Demanded 180 Price |Quantity Supplied $0.20 30 60 90 $030 160 $0.40 140 $0.50 120 120 $0.60 100 140 $0.70 80 160 $0.80 60 180 a) Suppose that the quantity demanded rises by 40 million packs of gum per month at each price. b) Draw the initial demand and supply curves as given by the table above. Call this graph Graph 1. Label this demand curve D1, and this supply curve S1. Draw the new demand curve given by this change, labeling it D2. Show the new equilibrium price and output, labeling this point A. Suppose that the quantity supplied rises by 50 million packs per month at each price, while the quantities demanded retain their D1 values. On a new graph (labeled as Graph 2), draw D1, S1, and the new supply curve, S2. Show the new equilibrium output and price, labeling this point C.
2. Reading a Demand Curve Suppose that the graph below shows the demand curve for aluminium. PRICE (Dollars per ton) 6400 5600 will 4800 4000 3200 2400 1600 800 0 0 80 120 160 200 240 280 QUANTITY OF ALUMINIUM (Millions of tons) 40 320 If the price of aluminium is $3200 per ton, buyers are willing to buy The maximum price buyers are willing to pay for 160 million tons of aluminium is (?) million tons of aluminium. per ton. Aluminium is highly valuable in the manufacturing of automobiles and aircraft due to its strength-to-weight ratio. It also has low-value uses, such as household wiring, where it can be substituted for other conductive materials. As the price of aluminium rises, the quantity demanded of aluminium because aluminium will
28)
6. Individual and market supply Suppose that Raphael and Susan are the only suppliers of donuts in some hypothetical market. Their weekly supply schedules are given by the following table: Price (Dollars per donut) 1 2 3 4 Raphael's Quantity Supplied Susan's Quantity Supplied (Donuts) (Donuts) 3 0 2 6 3 8 10 11
14. Determinants of Supply and Demand Consider the market for gas-powered small cars. Assume gas-powered small cars are a normal good. For each of the following events, identify which of the determinants of demand or supply are affected. If demand is unaffected by this event because it creates only a supply change, select the “None” option under the “Demand Determinant” column. Similarly, if supply is unaffected by this event because it creates only a demand change, select the “None” option under the “Supply Determinant” column. Event Demand Determinant Supply Determinant People decide to have more children. The price of electric small cars falls. The discovery of a new source of iron ore lowers steel prices. An economic recession lowers people’s wealth. A number of major car dealers decide to switch from selling gas-powered cars to selling electric cars. Show the effect of the following event…

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