QUESTION 7 The demand for rubber erasers consists of two components. The first component is the demand for rubber erasers by art students. This demand is given by QA = 19,500 - 325P. The second component is the demand for rubber erasers by all others. This demand is given by Qo= 32,000 - 2,000P. (a) What is the total quantity demanded of rubber erasers if the price of an eraser is: (i) $10 (ii) $15 (iii) $20 (iv) $30 (v) $70 (b) Assume that the supply of rubber erasers is given by Qs = 14,000 + 175P. (i) Find the equilibrium price and the equilibrium quantity. (ii) Calculate the total consumer surplus. [Hint: It may be easier if you calculate the consumer surplus for art students and the consumer surplus for all others separately, and then add them up.] (c) Assume that the supply of rubber erasers is given by Qs = 8,390 + 180P. Find the equilibrium price and the equilibrium quantity.

QUESTION 7 The demand for rubber erasers consists of two components. The first component is the demand for rubber erasers by art students. This demand is given by QA = 19,500 - 325P. The second component is the demand for rubber erasers by all others. This demand is given by Qo= 32,000 - 2,000P. (a) What is the total quantity demanded of rubber erasers if the price of an eraser is: (i) $10 (ii) $15 (iii) $20 (iv) $30 (v) $70 (b) Assume that the supply of rubber erasers is given by Qs = 14,000 + 175P. (i) Find the equilibrium price and the equilibrium quantity. (ii) Calculate the total consumer surplus. [Hint: It may be easier if you calculate the consumer surplus for art students and the consumer surplus for all others separately, and then add them up.] (c) Assume that the supply of rubber erasers is given by Qs = 8,390 + 180P. Find the equilibrium price and the equilibrium quantity.

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

QUESTION 7 To mark national burger day there is a nationwide 50% sale on burgers during May. A recent survey, of those who bought burgers at supermarkets and food trucks, found that 99% of people will only eat burgers in a bun. Which of the following statements are true: The decrease in the price of burgers during May will cause a decrease in the quantity demanded of burgers. The decrease in the price of burgers in May will cause an increase in both demand and quantity demanded for buns. The decrease in the price of burgers in May will only result in an increase in the quantity demanded for buns. Economic theory is unable to predict if there would be any shift in demand for buns with the discount on burgers in May.
Calculating the price elasticity of demand: A step-by-stepguide Suppose that during the past year, the price of a virtual reality headset rose from $4,100 to $4,550. During the same time period, consumer sales decreased from 420,000 to 313,000 headsets. Calculate the elasticity of demand between these two price–quantity combinations by using the following steps. After each step, complete the relevant part of the table with the appropriate answers. (Note: For decreases in price or quantity, enter values in the Change column with a minus sign.) Original New Average Change Percentage Change Quantity Price Step 1: Fill in the appropriate values for original quantity, new quantity, original price, and new price. Step 2: Calculate the average quantity by adding the original quantity and the new quantity, and then dividing by two. Do the same for the average price. Step 3: Calculate the change in quantity…
You are an economist for the City Subway Commission. Presently, the price of a subway ride is 80 cents, and 250000 seats are filled weekly. The price elasticity of demand for subway rides is -0.40, and the income elasticity of demand is -0.60. (A) If a recession lowered area incomes by 5%, how many additional seats per week would the subway need?
Typed answer.
Q44
What is the slope of the given demand curve?
Solve full question please
None
1 15 18 Question 6 An increase in quantity demanded is graphically represented by: Movement along a fixed demand curve A shift of the entire demand curve
Consider the weekly supply of gasoline in Figure 1. How much gasoline will producers wish to sell if the price of a gallon of gasoline is $1.20? A) 100K gallons b) 140K gallons C) 236K gallons D) 308K gallons
In a particular market, demand and supply curves are defined by the following equations: P=50 – 0.5QD QS= -20 + 2P where, P is the price in pounds, QS is the quantity supplied and QD is the quantity demanded. 1. What is the equilibrium price and quantity? 2. What is the price elasticity at a price of £35? 3. What do you expect will happen to total expenditure on this good if the price increases from £35 to £40? Is this expectation confirmed if you calculate the total revenue for each price?
(b)The equation for Bingo chips demand curve is P = 3/Q. What is the elasticity of Bingo chips demand as price falls from 6 to 5? What is the elasticity of Bingo chips demand as the price falls from 10 to 9? Would you expect these answers to be the same?