8: Glven that chicken and potatoes are complements In consumption, Ifthe price of chicken Increases there would be:O (A) an increase in the dernand for potatoes.O (B) an Increase in the quantity of potątoes demanded.O (C) a decrease in the demand for potatoes.O (D) a decrease In the quantity of potatoes demanded.O (E) no change in the demand for potatoes.

In a market, when two goods are complements for each other, price of one good will be negatively…

Answered: 8: Glven that chicken and potatoes are…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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4. Using three-step method to analyze the effects of each even on the equilibrium price and quality of good A. a) the price of substitutes of good A falls. b) the technology improvement. c) (a) and (b) both occur. Show Transcribed Text 2 - 3 sentence explanation each question, thanks
5. Suppose the supply of apples sharply increased because of perfect weather conditions throughout the growing season. Assuming no changes in demand, explain the effect on the equilibrium price and quantity of apples.
5. The elasticity of substitution will be a lower number: (a) The less curved is the indifference curve (b) The more curved is the indifference curve (c) The greater the income elasticity of demand of the good on the horizontal axis (d) The greater the degree of substitutability between the two goods (e) If tastes are both homothetic and quasilinear
FIGURE 2-4 Production possibilites curve Food Refer to Figure 2-4. If the economy chooses to shift more of its resources into clothing, what will it have to give up? Select one: O a. larger and larger amounts of food per unit of added clothing as the quantity of clothing produced increases O b. nothing, since food and clothing are NOT substitutes O c. relatively equal amounts of food per unit of added clothing as the quantity of clothing produced increases Clohing
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.
QUESTION 12 Assume that the price of cheese has decreased and the price of garlic bread (a substitute good) has decreased at the same time. How this will affect the market for pizzas? O a. Quantity of pizza would fall, and the effect on price would be ambiguous. O b. Price of pizza would rise, and the effect on quantity would be ambiguous. O. Quantity of pizza would rise, and the effect on price would be ambiguous. O d. Price of pizza would fall, and the effect on quantity would be ambiguous. QUESTION 13 Samuel owns a laundromat business in Queens, New York. He recently purchased 2 new washing machines and 2 new dryers. This will cause O a. the demand for laundromat services to increase. O b. the supply of laundromat services to decrease. O c. the demand for laundromat services to decrease. O d. the supply of laundromat services to increase. QUESTION 16 A likely example of complementary goods for most people would be O a. golf club and baseball bat. O b. tea and coffee. O c. CPA…
A change from Point B to Point C represents a(n): B E Price D Quantity O decrease in supply. O increase in quantity supplied. O increase in supply. O decrease in quantity supplied. 52 50
Think Critically a. Use the data below to construct a demand curve for pizza. Price Quantity 14 100 12 200 10 300 8 400 6 500 b. Explain two (2) reasons why the demand curve has a negative slope. c. For each of the following situations relating to the demand for pizza. identify the factor affecting demand demonstrate on the axes provided, and explain, the effects of the change. (I)an increase in the price of hamburgers Factor: ___________________________________ Explanation: ______________________________ (II) a media report announces that eating pizza increases the risk of heart disease Factor: ___________________________________ Explanation: ______________________________ d. What role does price play in the market and how does the type of market impact on the determination of price?
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3. Refer to the information provided in Figure below to answer the following questions. Price of pizza +6 0 A B D₁ D₂ Number of pizzas per month D3 a. Under what situation consumer moves from A to B? When they move from C to A? Explain the reasons in both cases. b. Imagine your demand curve for pizza last year was D3. Now the demand is D1. Write down possible reasons for this. Explain this carefully c. Can you expect the demand to increase at the same price? Explain the reasons carefully. d. Can you expect the demand to decrease at the same price? Explain this carefully.
10) Figure 1 shows some indifference curves and budget lines for consumer Yusuf. Milk A B Cheese Figure 1 If Yusuf's income increases, his optimal consumption changes from point A to point B. Which of the following statements is true for Yusuf? (a) Cheese and milk are substitutes. (b) Cheese is an inferior good. (c) Milk is an inferior good . (d) Milk is a normal good. (e) None of the above.
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