Consider the market for CD players, illustrated in the figure to the right. Suppose there are network externalities in this market such that the quantity of a good demanded grows in response to the growth of purchases by other individuals (as indicated by the demand curve "Demand" in the figure). Suppose that the price is initially $130 where the quantity demanded is 60 (thousand CD players per month). 200- Do 180- 160 Demand 140- If the price of CD players falls to $90, demand will increase to thousand CD 120- players per month. (Enter your response using an integer.) 100- 80- 60- 40- Deo P120 D180 20- 0- 40 60 80 1ỏ0 120 140 160 180 200 220 CD Players (thousands per month) 20 Price
Consider the market for CD players, illustrated in the figure to the right. Suppose there are network externalities in this market such that the quantity of a good demanded grows in response to the growth of purchases by other individuals (as indicated by the demand curve "Demand" in the figure). Suppose that the price is initially $130 where the quantity demanded is 60 (thousand CD players per month). 200- Do 180- 160 Demand 140- If the price of CD players falls to $90, demand will increase to thousand CD 120- players per month. (Enter your response using an integer.) 100- 80- 60- 40- Deo P120 D180 20- 0- 40 60 80 1ỏ0 120 140 160 180 200 220 CD Players (thousands per month) 20 Price
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:Consider the market for CD players, illustrated in the figure to the right. Suppose
there are network externalities in this market such that the quantity of a good
demanded grows in response to the growth of purchases by other individuals (as
indicated by the demand curve "Demand" in the figure). Suppose that the price is
initially $130 where the quantity demanded is 60 (thousand CD players per
month).
200-
Do
180-
160-
Demand
140-
If the price of CD players falls to $90, demand will increase to
thousand CD
120-
players per month. (Enter your response using an integer.)
100-
80-
60-
40-
Do
P120
20-
0+
20
40 60 80 100 120 140 160 180 200 220
CD Players (thousands per month)
Price
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