Answered: The demand for computers is…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

The demand for computers is

QD=13−2P,

where P is the price of computers.

Initially, the supply of computers is

QS=4+P.

Use the demand equation above to plot the demand curve.

1.)	Using the line drawing tool, accurately draw the demand curve. Draw the curve for quantities from at least 1 to 11. Properly label your line.
2.)	Using the point drawing tool, indicate the equilibrium price and quantity. Label your point 'E1'.

Carefully follow the instructions above and only draw the required objects.

The equilibrium price is... per computer.

(Round your response to one decimal place.)

The equilibrium quantity is......computers per

week.

(Roundyour response to the nearest nteger.)

Suppose the prices of memory chips and motherboards

(two important components in computers) rise and as a

consequence, the supply curve for computers becomes

QS=P.

In a supply-and-demand diagram, accurately show the effect of the increase in the prices of memory chips and motherboards on the equilibrium price and quantity of computers.

Use the new supply equation to plot the supply curve.

1.)	Using the line drawing tool, shift either the demand curve or the supply curve to show the effect described above. Draw the curve for quantities from at least 1 to 7. Properly label your line.
2.)	Using the point drawing tool,indicate the new equilibrium price and quantity. Label your point 'E2'.

Carefully follow the instructions above and only draw the required objects.

The new equilibrium price is.....per computer.

(Round your response to one decimal place.)

The new equilibrium quantity is...... computers per week.

(Round your response to the nearest integer.)

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