Question 2 a. Illustrate the impact on equilibrium price and quantity of the following: i. Market for laptops There has been increased access to wireless technology and laptops have a lighter weight. Laptops have also become easier and cheaper to produce as new technology has come online. ii. Market for pork Doctors warn that consumption of pork may lead to high cholesterol coupled with an increase in the price of pig feed. iii. Market for office spaces During the Covid 19 pandemic, there was an increase in the number of persons who worked from home. iv. Market for Alumina The government has decided to offer subsidies to local alumina producers to assist as they compete against foreigners. b. The equilibrium price of printers saw a large decrease in the past year, however the equilibrium quantity remained unchanged. Three individuals provided an explanation for the situation. Which explanation(s) could be correct? Explain. • Alex: Demand increased, but supply was totally inelastic. • Lance: Supply increased, but so did demand. • Ricardo: Supply decreased, but demand was totally inelastic
Question 2
a. Illustrate the impact on
i. Market for laptops
There has been increased access to wireless technology and laptops have
a lighter weight. Laptops have also become easier and cheaper to
produce as new technology has come online.
ii. Market for pork
Doctors warn that consumption of pork may lead to high cholesterol
coupled with an increase in the price of pig feed.
iii. Market for office spaces
During the Covid 19 pandemic, there was an increase in the number of
persons who worked from home.
iv. Market for Alumina
The government has decided to offer subsidies to local alumina
producers to assist as they compete against foreigners.
b. The equilibrium price of printers saw a large decrease in the past year, however
the equilibrium quantity remained unchanged. Three individuals provided an
explanation for the situation. Which explanation(s) could be correct? Explain.
• Alex: Demand increased, but supply was totally inelastic.
• Lance: Supply increased, but so did demand.
• Ricardo: Supply decreased, but demand was totally inelastic
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