7. Short-run and long-run effects of a shift in demand Suppose that the turkey industry is in long-run equilibrium at a price of $5 per pound of turkey and a quantity of 300 million pounds per year. Suppose hat the Centers for Disease Control (CDC) announces that a chemical found in turkey is causing bacterial infections to spread around the world. The CDC's announcement will cause consumers to demand turkey at every price. In the short run, firms will respond by Shift the demand curve, the supply curve, or both on the following graph to illustrate these short-run effects of the CDC's announcement. 10 Supply Demand 7 Supply 4 Demand 60 120 180 240 300 360 420 480 540 600 QUANTITY (Millions of pounds) PRICE (Dollars per pound)

7. Short-run and long-run effects of a shift in demand Suppose that the turkey industry is in long-run equilibrium at a price of $5 per pound of turkey and a quantity of 300 million pounds per year. Suppose hat the Centers for Disease Control (CDC) announces that a chemical found in turkey is causing bacterial infections to spread around the world. The CDC's announcement will cause consumers to demand turkey at every price. In the short run, firms will respond by Shift the demand curve, the supply curve, or both on the following graph to illustrate these short-run effects of the CDC's announcement. 10 Supply Demand 7 Supply 4 Demand 60 120 180 240 300 360 420 480 540 600 QUANTITY (Millions of pounds) PRICE (Dollars per pound)

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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7. Short-run supply and long-run equilibrium Consider the competitive market for copper. Assume that, regardless of how many firms are in the industry, every firm in the industry is identical and faces the marginal cost (MC), average total cost (ATC), and average variable cost (AVC) curves shown on the following graph.
QUESTION 33 Consider a major producer of liquid soap. Which of the following would not shift its supply curve of liquid soap inward (to the left)? O a. A substitute in supply becomes more profitable O b. Environmental regulations requiring the producer to use a more costly technology to produce liquid soap O c. An increase in the wage rate for factory workers who produce liquid soap O d. A decrease in the price of liquid soap
Price 0 52 * S" Quantity Refer to Figure 3-8. The graph in this figure illustrates an initial competitive equilibrium in the market for motorcycles at the intersection of D2 and 52 (point E). If the technology to produce motorcycles improves and the number of buyers increases, how will the equilibrium point change? O The equilibrium point will move from E to B. O The equilibrium point will move from E to C. The equilibrium point will move from E to A. The equilibrium point will remain at E.
6. Deriving the short-run supply curve Consider the competitive market for dress shirts. The following graph shows the marginal cost (MC), average total cost (ATC), and average variable cost (AVC) curves for a typical firm in the industry. COSTS (Dollars) PRICE (Dollars per shirt) 100 90 80 70 60 50 100 40 90 10 80 0 70 Price (Dollars per shirt) 60 50 20 10 0 0 For each price in the following table, use the graph to determine the number of shirts this firm would produce in order to maximize its profit. Assume that when the price is exactly equal to the average variable cost, the firm is indifferent between producing zero shirts and the profit- maximizing quantity. Also, indicate whether the firm will produce, shut down, or be indifferent between the two in the short run. Lastly, determine whether it will make a profit, suffer a loss, or break even at each price. 15 20 25 55 70 85 10 0 0 0 MC D ATC On the following graph, use the orange points (square symbol) to plot points along the…
20.Suppose a demand for good produced by a certain industry changes then answer the following questions:1- What will be the affect of change in demand on the output of the firm and industry in short run?2- What will be the affect of change in demand on the output of the firm and industry in long run?3-For what reason the affect of change in demand on firm's and industry's output differ in short and long run?4- Will the condition of zero economic profit be met in long run? how?
8. Short-run and long run effects of a shift in demand Suppose that the tuna industry is in long-run equilibrium at a price of $5 per can of tuna and a quantity of 350 million cans per year. Suppose that WebMD daims that a protein found in tuna will increase your expected lifespan by 2 years. WebMD's claim will cause consumers to demand more PRICE (Dollars per cani producing more tuna and earning positive profit Shift the demand curve, the supply curve, or both on the following graph to illustrate these short-run effects of WebMD's claim. ? 0 tuna at every price. In the short run, firms will respond by Supply Demand 70 140 210 200 350 420 400 560 630 700 QUANTITY (Millions of cans) Demand -0 Supply
51 / 69 75% 9. Table: Impact of Simultaneous Shifts on Equilibrium Shift in Shift in Supply Quantity A Export PDF Price Demand Create PDF May increase, Edit PDF decrease or Leftward Leftward Decreases remain Comment unchanged May increase, Da Combine F decrease or Rightward Rightward Increases Adobe Acrobat Pr remain unchanged Combine bao or mor into a single PDF May increase, decrease or Learn mo Decreases Leftward Rightward remain unchanged N Organize F May increase, Redact decrease or Increases Rightward remain U Protect Leftward unchanged Store and share 図

Suppose that the tuna industry is in long-run equilibrium at a price of $5 per can of tuna and a quantity of 500 million cans per year. Suppose that WebMD claims that the bacteria found in tuna will decrease your expected lifespan by 2 years. WebMD's claim will cause consumers to demand Shift the demand curve, the supply curve, or both on the following graph to illustrate these short-run effects of WebMD's claim. ? PRICE (Dollars per can) 10 9 8 0 O tuna at every price. In the short run, firms will respond by 100 200 Supply Demand 300 400 500 600 700 800 QUANTITY (Millions of cans) 000 1000 Demand 1 Supply
10. Price elasticity of supply in the short run and long run The following graph shows the short-run supply curve for persimmons. Place the orange line (square symbol) on the following graph to show the most likely long-run supply curve for persimmons. (Note: Place the points of the line either on W and P or on W and I.) PRICE (Dollars per pound) 24 20 Co 16 0 0 W Short-Run Supply 2 4 6 8 10 QUANTITY (Thousands of pounds of persimmons) 12 Long-Run Supply ?
price elasticity of supply in the short run and long run Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism.Answer completely.You will get up vote for sure.
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3. GB Motor Company produced 600,000 bikes at a price of $440 each. The company made a profit of $60 million that year. The CEO of the company told a journalist that he intended to reduce the price of their bikes to $360, and he expected to sell 900,000 bikes at that price. a) Did GB Motor Company expect the total revenue they receive from selling the bikes to rise or fall following the price cut?