Price, P The diagram shows the market demand and supply curves for the bread market. There are 250 identical bakeries operating in the market with the same cost structure (i.e. they have the same fixed and marginal costs). €4.50 €4.00 €3.50 €3.00 €2.50 € 2.00 € 1.50 € 1.00 €0.50 €0.00 Supply curve 6,500 Demand curve 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,00010,000 Quantity, Q: number of loaves Based on this information, which of the following statements is correct? At a price of €1.50, all 250 bakeries would be making a loss. At a price of €2.00, all 250 bakeries will sell 5000 loaves each. At a price of €2.00, all 250 bakeries will sell 20 loaves each. At a price of €2.50, all 250 bakeries will sell 26 loaves each. The figure shows the market for second-hand textbooks, with an original demand curve and a new demand curve when 100 more students arrive on campus. Based on the figure, which of the following statements is correct? 25 Price (S) 20 15 10 5 New demand Original demand Supply 5 10 15 20 25 30 35 40 45 50 55 60 Quantity of books The increase in demand is good for both buyers and sellers. The more elastic (or more flat) the supply curve, the more the price would rise. The arrival of more students leads to an increase in the supply of textbooks. O The arrival of students leads to excess demand for textbooks.
Price, P The diagram shows the market demand and supply curves for the bread market. There are 250 identical bakeries operating in the market with the same cost structure (i.e. they have the same fixed and marginal costs). €4.50 €4.00 €3.50 €3.00 €2.50 € 2.00 € 1.50 € 1.00 €0.50 €0.00 Supply curve 6,500 Demand curve 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,00010,000 Quantity, Q: number of loaves Based on this information, which of the following statements is correct? At a price of €1.50, all 250 bakeries would be making a loss. At a price of €2.00, all 250 bakeries will sell 5000 loaves each. At a price of €2.00, all 250 bakeries will sell 20 loaves each. At a price of €2.50, all 250 bakeries will sell 26 loaves each. The figure shows the market for second-hand textbooks, with an original demand curve and a new demand curve when 100 more students arrive on campus. Based on the figure, which of the following statements is correct? 25 Price (S) 20 15 10 5 New demand Original demand Supply 5 10 15 20 25 30 35 40 45 50 55 60 Quantity of books The increase in demand is good for both buyers and sellers. The more elastic (or more flat) the supply curve, the more the price would rise. The arrival of more students leads to an increase in the supply of textbooks. O The arrival of students leads to excess demand for textbooks.
Essentials of Economics (MindTap Course List)
8th Edition
ISBN:9781337091992
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter13: Firms In Competitive Markets
Section: Chapter Questions
Problem 7PA
Related questions
Question
Transcribed Image Text:Price, P
The diagram shows the market demand and supply curves for the bread market. There are
250 identical bakeries operating in the market with the same cost structure (i.e. they have the
same fixed and marginal costs).
€4.50
€4.00
€3.50
€3.00
€2.50
€ 2.00
€ 1.50
€ 1.00
€0.50
€0.00
Supply
curve
6,500
Demand
curve
0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,00010,000
Quantity, Q: number of loaves
Based on this information, which of the following statements is correct?
At a price of €1.50, all 250 bakeries would be making a loss.
At a price of €2.00, all 250 bakeries will sell 5000 loaves each.
At a price of €2.00, all 250 bakeries will sell 20 loaves each.
At a price of €2.50, all 250 bakeries will sell 26 loaves each.
Transcribed Image Text:The figure shows the market for second-hand textbooks, with an original demand curve and a
new demand curve when 100 more students arrive on campus. Based on the figure, which of
the following statements is correct?
25
Price (S)
20
15
10
5
New demand
Original demand
Supply
5
10
15
20
25
30 35
40
45
50
55
60
Quantity of books
The increase in demand is good for both buyers and sellers.
The more elastic (or more flat) the supply curve, the more the price would rise.
The arrival of more students leads to an increase in the supply of textbooks.
O The arrival of students leads to excess demand for textbooks.
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