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Multiple answers may be correct:  D-Flat is elastic and D-Steep in inelastic D-Flat and D-Steep are both elastic. D-Flat and D-Steep are both inelastic. There is a bigger change in quantity to a change in price on D-Flat An increase in price will cause a decreae in total revnue/Expenditure when demand is inelastic. An increase in price will cause an increase in Total Revenue/Expenditre on D-Flat and a decrease on D-Steep.

Multiple answers may be correct:  D-Flat is elastic and D-Steep in inelastic D-Flat and D-Steep are both elastic. D-Flat and D-Steep are both inelastic. There is a bigger change in quantity to a change in price on D-Flat An increase in price will cause a decreae in total revnue/Expenditure when demand is inelastic. An increase in price will cause an increase in Total Revenue/Expenditre on D-Flat and a decrease on D-Steep.

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Multiple answers may be correct: 
D-Flat is elastic and D-Steep in inelastic
D-Flat and D-Steep are both elastic.
D-Flat and D-Steep are both inelastic.
There is a bigger change in quantity to a change in price on D-Flat
An increase in price will cause a decreae in total revnue/Expenditure when demand is inelastic.
An increase in price will cause an increase in Total Revenue/Expenditre on D-Flat and a decrease on D-Steep.
### Supply and Demand Curve The graph above illustrates the interplay between supply and demand curves, showcasing the effects of changes in supply and demand on equilibrium price and quantity. Here's a detailed breakdown of the graph's components: #### Axes: - **X-axis (Q)**: Represents the quantity of goods. - **Y-axis (P)**: Represents the price level of the goods. #### Lines: - **S (Red Line)**: The upward-sloping supply curve. - **D_Flat (Top Blue Line)**: A flatter demand curve. - **D_Steep (Bottom Blue Line)**: A steeper demand curve. #### Points and Intersections: - **Point A**: The initial equilibrium, where the supply curve (S) intersects the flatter demand curve (D_Flat), at a quantity of \(Q_1 = 100\) and a price of \(P_1 = 10\). #### Shifts and New Equilibria: - **New Price Level \(P_2 = 12\)**: Represented by the horizontal red dotted line at \(P = 12\). - **New Quantity Levels**: - **\(Q_2 = 90\)**: New quantity associated with the flatter demand curve at the new price level \(P_2 = 12\). - **\(Q_3 = 50\)**: New quantity associated with the steeper demand curve at the new price level \(P_2 = 12\). - **Points B and C**: - **Point B**: Intersection of the new price level \(P_2 = 12\) and the flatter demand curve \(D_Flat\), leading to quantity \(Q_2 = 90\). - **Point C**: Intersection of the new price level \(P_2 = 12\) and the steeper demand curve \(D_Steep\), leading to quantity \(Q_3 = 50\). #### Analysis: - When the price level increases from \(P_1 = 10\) to \(P_2 = 12\), the quantity demanded decreases differently based on the slope of the demand curve. - For the flatter demand curve (\(D_Flat\)), the quantity decreases from \(Q_1 = 100\) to \(Q_2 = 90\). - For the steeper demand curve (\(D_Steep\
Transcribed Image Text:### Supply and Demand Curve The graph above illustrates the interplay between supply and demand curves, showcasing the effects of changes in supply and demand on equilibrium price and quantity. Here's a detailed breakdown of the graph's components: #### Axes: - **X-axis (Q)**: Represents the quantity of goods. - **Y-axis (P)**: Represents the price level of the goods. #### Lines: - **S (Red Line)**: The upward-sloping supply curve. - **D_Flat (Top Blue Line)**: A flatter demand curve. - **D_Steep (Bottom Blue Line)**: A steeper demand curve. #### Points and Intersections: - **Point A**: The initial equilibrium, where the supply curve (S) intersects the flatter demand curve (D_Flat), at a quantity of \(Q_1 = 100\) and a price of \(P_1 = 10\). #### Shifts and New Equilibria: - **New Price Level \(P_2 = 12\)**: Represented by the horizontal red dotted line at \(P = 12\). - **New Quantity Levels**: - **\(Q_2 = 90\)**: New quantity associated with the flatter demand curve at the new price level \(P_2 = 12\). - **\(Q_3 = 50\)**: New quantity associated with the steeper demand curve at the new price level \(P_2 = 12\). - **Points B and C**: - **Point B**: Intersection of the new price level \(P_2 = 12\) and the flatter demand curve \(D_Flat\), leading to quantity \(Q_2 = 90\). - **Point C**: Intersection of the new price level \(P_2 = 12\) and the steeper demand curve \(D_Steep\), leading to quantity \(Q_3 = 50\). #### Analysis: - When the price level increases from \(P_1 = 10\) to \(P_2 = 12\), the quantity demanded decreases differently based on the slope of the demand curve. - For the flatter demand curve (\(D_Flat\)), the quantity decreases from \(Q_1 = 100\) to \(Q_2 = 90\). - For the steeper demand curve (\(D_Steep\
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