3) Coca-Cola: Suppose that Pepsi decreases the price of its six-packs from $3.00 to $2.50.How would this news change the demand for six-packs of Coca-Cola?a. First, graph the situation with price of Coca-Cola and quantity of Coca-Cola. UseBLACK for supply, BLUE for demand. Label supply as Sı and demand as Dj and D2.b. Using your knowledge of the laws of supply and demand, explain the shift(s) that havebeen made in your graph and describe what happened to the equilibrium price andquantity (3-4 bullet points), Make sure to include the 8 determinants of demand or 5determinants of supply. Label the equilibrium points CLEARLY!c. Add a picture of Coca-Cola vs. Pepsi.

The law of demand states that an increase in price would lead to a reduction in the quantity being…

Answered: 3) Coca-Cola: Suppose that Pepsi…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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. If there is a fall in the price of a close substitute for potato crisps, such as tortilla chips, this will cause A) a rightward shift of the demand curve and a move along the supply curve of potato crisps. B) a leftward shift of the demand curve and a move along the supply curve of potato crisps. C) a leftward shift of the demand curve and a rightward shift of the supply curve of potato crisps. D) a move along the demand curve and a leftward shift the supply curve of potato crisps
The market for cruises is at its market equilibrium when two events occur: cruise companies increase the number of cruise ships, and at the same time, cruising becomes less popular. How does the market for cruises change? The equilibrium price of a cruise ________ and the equilibrium quantity of cruises _______. A. falls; might increase, decrease, or not change B. falls; increases C. rises; decreases D. might rise, fall, or not change; decreases
1. Suppose the demand for towels and supply of towels are given by the below: QD = 100 - 4P QS = P a. Find the equilibrium price and quantity using demand and supply functions above. b. Plot demand and supply curve on the same graph and point out the equilibrium quantity and price. You should draw each graph precisely with intercepts and slopes. c. Solve for the price elasticities of demand and supply at the equilibrium point. Which is more elastic: demand or supply? Simply explain why. d. Suppose there was a demand shock so that at each price 20 more towels are demanded since consumers want more. Plot the new demand curve on the graph that you derive in part (a). Find the new equilibrium price and quantity. (Hint: You may derive a new demand function by adding a constant to find a new equilibrium price and quantity.)
Which of the following is true if both the demand for and supply of oranges increase? A. it is clear that prices will increase, the change in the quantity of oranges sold is ambiguous. B. it is clear that quantity sold will increase, the change in the price of oranges is ambiguous. C. it is clear that prices will decrease, the change in the quantity of oranges sold is ambiguous. O D. it is clear that quantity sold will decrease, the change in the price of oranges is ambiguous.
Use the following information to answer questions 3 and 4: Consider the following demand schedule for shoes. Price Quantity Demanded $5 385 $10 365 $15 345 $20 325 $25 305 $30 285 $35 265 $40 245 3. Suppose that the store increases the price of shoes from $25 to $30. Using the mid-point approach, calculate price elasticity of demanded. 4. Suppose that the store increases the price of shoes from $25 to $30. Based on this information, the demand curve would be classified as (select one): inelastic elastic unit elastic
6. How would an increase in income for an inferior good affect demand for the good? How would an increase in income for a cheap good affect the demand curve for that good? Show graphically.
a. Given the data in the table below, draw the demand curve in the graph below. Plot all 6 points using the tool provided in the graphing area below. Price Quantity Demanded 1 200 2 160 3 120 4 80 5 40 6 0 b. What is the equilibrium price and quantity? The equilibrium price is $ and the equilibrium quantity is
6. How will the following events affect equilibrium price and quantity for the product highlighted in italics? In each case, identify how the supply or demand curve shifts. a. A drop in consumer incomes influences the demand for dry cleaning b. Declining numbers of law school graduates affect the supply of legal services c. Consumer expectations that the price of turkeys will soon rise affect the current demand for turkeys d. A cost-saving technological innovation influences the supply of rice
20. If there is a rise in price of Galaxy chocolate, people will demand KitKat chocolate and consequently the demand for KitKat chocolate will increase. - Identify the type of demand and explain the reason and relationship.
12. What is the difference between a change in supply and a change in quantity supplied? A (change in supply) or to the right (an increase in supply). A change in supply, therefore, is a change in the entire supply schedule or curve. ) is a shift in the entire supply curve either to the left (a decrease in In contrast, a ( change in schedule from one price-quantity combination to another. A change in product price causes the change in quantity supplied. ) is a movement along an existing supply curve or PA P (Increase, Decrease) in (Increase, Decrease) in
2.
4. Demand shifters The following graph shows the market demand for kumquats. Suppose that government reports link an outbreak of salmonella poisoning to a recent kumquat crop. Show the impact of the government report by shifting the demand curve on the following graph. Note: Select and drag the curve to the desired position. The curve will snap into position, so if you try to move a curve and it snaps back to its original position, just drag it a little farther. PRICE (Dollars per crate) Demand QUANTITY (Crates of kumquats) Demand The following graph shows the market demand for televisions, which are normal goods. Suppose that a deep economic recession causes consumer income to decline.

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