8. The market for pizza has the following demand and supply schedules: Price in $ Quantity Demanded Quantity Supplied 26 4 135 104 53 81 81 68 98 53 39 110 121 a) Graph the demand and supply curves. (Graph should be properly labelled) b) What is the equilibrium price and equilibrium quantity? c) Show graphically the shifts in demand curve OR supply curve of Pizza in the following cases; Income of the consumers decreases (consider pizza is a normal good) Prices of Burgers increases (consider burgers are substitute to pizza) (1) (ii) (ii1) Number of pizza sellers increased.

8. The market for pizza has the following demand and supply schedules: Price in $ Quantity Demanded Quantity Supplied 26 4 135 104 53 81 81 68 98 53 39 110 121 a) Graph the demand and supply curves. (Graph should be properly labelled) b) What is the equilibrium price and equilibrium quantity? c) Show graphically the shifts in demand curve OR supply curve of Pizza in the following cases; Income of the consumers decreases (consider pizza is a normal good) Prices of Burgers increases (consider burgers are substitute to pizza) (1) (ii) (ii1) Number of pizza sellers increased.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

6) Dodger Baseball!!!! : The Dodgers will host the 2020 MLB All Star Game! Fans are ECSTATIC. Also, the Dodgers will expand seating by 10,000 in the CF Pavilion area. How will that shift the supply and demand curves for Dodger tickets? a. Graph the situation with price of Dodger tickets and quantity of Dodger tickets. Use BLACK for supply, BLUE for demand. Label supply as Sj and S2 and demand as Di and D2. b. Using your knowledge of the laws of supply and demand, explain the shift(s) that have been made in your graph and describe what happened to the equilibrium price and quantity (3-4 bullet points). Make sure to include the either the 8 determinants of demand or 5 determinants of supply. Label the equilibrium points CLEARLY! c. Add a picture of the Dodgers.
4. Determinants of the price elasticity of demand Consider some determinants of the price elasticity of demand: • Availability of close substitutes • Whether the good is a necessity or a luxury • Whether the good is broadly defined • The proportion of a consumer's budget spent on the good • Time people have to adapt to new price changes A good without any close substitutes is likely to have relatively demand, because consumers cannot easily switch to a substitute good if the price of the good rises. A good's price elasticity of demand depends in part on how necessary it is relative to other goods. If the following goods are priced approximately the same, which one has the most elastic demand? Sports car Chemotherapy for cancer patients Price elasticity for a good depends on the share of a consumer's budget spent on a good. Other things being equal, which of the following goods has the most elastic demand? Thumbtacks Fish food O Monthly cell phone bill
b) i. Draw a Demand and Supply diagram for Coffee Beans based on the demand and supply schedule below. Price ($/kg) Quantity Demanded (kg) Quantity Supplied (kg) 2 500,000 300,000 400,000 400,000 4 300,000 500,000 200,000 600,000 6 100,000 700,000 i. What is the equilibrium price and quantity of Coffee Beans? 3.
3. The following table gives the supply schedule for Purcell Ltd, a UK based rug producer. Price (£) Quantity Supplied (Qs) 10 0 20 15 30 21 40 28 (i) What does the price elasticity of supply (PES) measure? (ii) How is it calculated? Write down the full formulae. (iii) Assume that the current price is £20. Calculate the price elasticity of supply if the price increases to £30 (show all your calculations). (iv) Is supply elastic, unit-elastic, or inelastic? Explain why. (v) What would the slope of the supply curve look like? (Hint: Relatively flat or steep supply curve) Based on your calculation and your analysis, draw the supply curve for Purcell Ltd. (vi) Would you expect the PES of rugs to be different in the short term and the long term? Explain your answer in detail.
(Figure: The Demand for Online Movies) Use Figure: The Demand for Online Movies. If the price of online movies decreases from $6 to $4, total revenue which means that demand is Price $10 8 6 4 30 60 90 Quantity Ochanges from $60 to $90; elastic o remains constant; unit-elastic changes from $240 to $360; elastic Ochanges from $40 to $50; inelastic
9. When the demand curve shifts, the change in equilibrium price will be larger the moreelastic the supply curve.(a) True(b) False
4. Graph the supply and demand curves and use the midpoint (averages) formula to calculate the respective price elasticities of supply and demand over the price range given. Then determine over what range of prices supply and demand are elastic, unit elastic, or inelastic. E₁ QS 2400 2200 1900 1500 1000 500 Price $14 12 10 8 6 4 QD ol 500 1000 1500 2000 2500 Ed
5. The variety of demand curves The following graph displays four demand curves (LL, MM, NN, and OO) that intersect at point A. PRICE (Dollars per unit) 400 360 320 280 240 200 160 120 80 40 H 0 40 M B N + 'xx. DE O A N M + 80 120 160 200 240 280 320 360 400 QUANTITY (Units) ?
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. Complete the sentences: A demand curve shows the quantity demanded at each possible holding the other factors that influence purchases. The quantity demanded is the amount of a good that consumers are willing to given price, holding the other factors that influence purchases. Changes in the quantity demanded in response to changes in price are A change in any relevant factor other than the price of the good causes at a
5. The demand equation for a good is given by the equation: О, 3 520 — 20Р, + 0.6Y + 2.9Р, a. Find the price, income and cross price elasticity of demand when P, = 10, Y = Р, 3 21 700 and b. Discuss the effect on demand if there were a 20% increase in price c. Discuss the effect on demand if there were a 50% decrease in income
13. The table below gives part of the supply schedule for personal computers in the United States. Price Quantity Supplied before tech change Quantity Supplied after tech $1,100 $900 12,000 8,000 change 13,000 9,000 a) Calculate the price elasticity of supply when price rises from $900 to $1,100 using the arc elasticity formula (the midpoint method). b) Now suppose that technology changes such that at every price, 1000 more computers are supplied. Now, as prices rise from $900 to $1,100, is the elasticity of supply smaller than, larger than, or equal to the elasticity in part a)? c) Does the change in b) change the slope of the supply curve? Are slope and elasticity the same thing? Explain.