The following calculator shows the demand curve for sedans (for example, Toyota Camrys or Honda Accords) in New York City. For simplicity, assume that all sedans are identical and sell for the same price. Initially, the calculator shows market demand under the following circumstances: Average household income is $50,000 per year, the price of a gallon of regular unleaded gas is $4 per gallon, and the price of a subway ride is $2.00. Use the graph input tool to help you answer the following questions. You will not be graded on any changes you make to this graph. Note: Once you enter a value in a white field, the graph and any corresponding amounts in each grey field will change accordingly. PRICE (Thousands of dollars per sedan) ... 8 10 0 0 Demand for Sedans Derrand 100 200 300 400 500 600 700 800 900 QUANTITY (Sedans per month) Graph Input Tool Demand for Sedans An increase in average income causes a rightward Price of a sedan (Thousands of dollars) Quantity Demanded (Sedans per month) Demand Shifters Average Income (Thousands of dollars) Price of Gas (Dollars per gallon) Price of a Subway Ride (Dollars) 20 450 50 4 2 Consider the graph. Suppose that the price of a sedan decreased from $25,000 to $20,000. This would cause a curve. the demand the demand curve; therefore, you may conclude that sedans are good. (Hint: Try substituting different values for Average Income in the calculator and observing what happens.) Suppose that, due to an increase in the number of a subways, the price of a subway ride falls from $2.00 to $1.50. Because driving a car and taking a decrease in the price of a subway ride shifts the demand curve for sedans to the the subway are
The following calculator shows the demand curve for sedans (for example, Toyota Camrys or Honda Accords) in New York City. For simplicity, assume that all sedans are identical and sell for the same price. Initially, the calculator shows market demand under the following circumstances: Average household income is $50,000 per year, the price of a gallon of regular unleaded gas is $4 per gallon, and the price of a subway ride is $2.00. Use the graph input tool to help you answer the following questions. You will not be graded on any changes you make to this graph. Note: Once you enter a value in a white field, the graph and any corresponding amounts in each grey field will change accordingly. PRICE (Thousands of dollars per sedan) ... 8 10 0 0 Demand for Sedans Derrand 100 200 300 400 500 600 700 800 900 QUANTITY (Sedans per month) Graph Input Tool Demand for Sedans An increase in average income causes a rightward Price of a sedan (Thousands of dollars) Quantity Demanded (Sedans per month) Demand Shifters Average Income (Thousands of dollars) Price of Gas (Dollars per gallon) Price of a Subway Ride (Dollars) 20 450 50 4 2 Consider the graph. Suppose that the price of a sedan decreased from $25,000 to $20,000. This would cause a curve. the demand the demand curve; therefore, you may conclude that sedans are good. (Hint: Try substituting different values for Average Income in the calculator and observing what happens.) Suppose that, due to an increase in the number of a subways, the price of a subway ride falls from $2.00 to $1.50. Because driving a car and taking a decrease in the price of a subway ride shifts the demand curve for sedans to the the subway are
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
Transcribed Image Text:The following calculator shows the demand curve for sedans (for example, Toyota Camrys or Honda Accords) in New York City. For simplicity, assume
that all sedans are identical and sell for the same price. Initially, the calculator shows market demand under the following circumstances: Average
household income is $50,000 per year, the price of a gallon of regular unleaded gas is $4 per gallon, and the price of a subway ride is $2.00.
Use the graph input tool to help you answer the following questions. You will not be graded on any changes you make to this graph.
Note: Once you enter a value in a white field, the graph and any corresponding amounts in each grey field will change accordingly.
8
PRICE (Thousands of dollars per sedan)
30
10
0
0
Demand for Sedans
Demand
100 200 300 400 500 600 700 800 900
QUANTITY (Sedans per month)
Graph Input Tool
Demand for Sedans
Price of a sedan
(Thousands of
dollars)
Quantity
Demanded
(Sedans per
month)
An increase in average income causes a rightward
Demand Shifters
Average Income
(Thousands of
dollars)
Price of Gas
(Dollars per gallon)
Price of a Subway
Ride
(Dollars)
20
450
50
2
Consider the graph. Suppose that the price of a sedan decreased from $25,000 to $20,000. This would cause a
curve.
the demand
the demand curve; therefore, you may conclude that sedans are
good. (Hint: Try substituting different values for Average Income in the calculator and observing what happens.)
Suppose that, due to an increase in the number of a subways, the price of a subway ride falls from $2.00 to $1.50. Because driving a car and taking
a decrease in the price of a subway ride shifts the demand curve for sedans to the
the subway are
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 5 steps with 1 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.Recommended textbooks for you
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
Principles of Economics (MindTap Course List)
Economics
ISBN:
9781305585126
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Managerial Economics: A Problem Solving Approach
Economics
ISBN:
9781337106665
Author:
Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:
Cengage Learning
Managerial Economics & Business Strategy (Mcgraw-…
Economics
ISBN:
9781259290619
Author:
Michael Baye, Jeff Prince
Publisher:
McGraw-Hill Education