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- Suppose an increase in demand in the market for mutual funds (a financial capital market) causes the interest rate to increase from 2% to 4%. How will this increase in demand affect supply and quantity supplied?Please answer fast and solve part ASuppose that in 2007 Ford sold 500,000 Mustangs at an average price of $18,800 per car; in 2008, 600,000 Mustangs were sold at an average price of $19,500 per car. From these statements what changes in supply or demand on the market for Mustangs produced such changes in equilibrium? (One graph. Start by plotting two points (price versus quantity, shift either supply or demand, not both) and then draw supply and demand graphs through them in a way that explains the change in the equilibrium from 2007 to 2008.
- Consider the market for CD players, illustrated in the figure to the right. Suppose there are network externalities in this market such that the quantity of a good demanded grows in response to the growth of purchases by other individuals (as indicated by the demand curve "Demand" in the figure). Suppose that the price is initially $90 where the quantity demanded is 120 (thousand CD players per month). If the price of CD players falls to $50, demand will increase to 180 thousand CD players per month. (Enter your response using an integer.) Of this increase, price effect and thousand units of the 60 thousand-unit increase is the pure thousand units of the increase is the bandwagon effect. C Price 200- 180- 160- 140- 120+ 100- 80- 60- 40- 20- 0+ 0 Doo Demand 20 P150 D60 P120 180 40 60 80 100 120 140 160 180 200 220 CD Players (thousands per month)True or false: keeping his maximum willingness to pay for a yacht in mind, Tim will buy the yacht because it will be worth more to him than its market price of $350,000Suppose that Bob and Cho are the only suppliers of pizza slices in a particular market. The following table shows their weekly supply schedules: Price (Dollars per slice) 1 2 3 4 5 PRICE (Dollars per slice) 6 5 0 0 Bob's Quantity Supplied Cho's Quantity Supplied (Slices) 0 (Slices) 5 4 9 On the following graph, plot Bob's supply of pizza slices using the green points (triangle symbol). Next, plot Cho's supply of pizza slices using the purple points (diamond symbol). Finally, plot the market supply of pizza slices using the orange points (square symbol). 4 Note: Line segments will automatically connect the points. Remember to plot from left to right. 8 6 7 12 8 16 QUANTITY (Slices) 12 20 14 24 15 A Bob's Supply Cho's Supply Market Supply
- In a town of two people, Ben and Tem (bear with me on this, okay) the city is trying to decide how many acres to devote to the public park. Ben's demand function is QA = 20 - p and Tem demand TD = 20 function is QD = 26 – 20p, where Q is measured in acres and p is measured in dollars. Acres are supplied according to the function p = 10 + 60Q. a. Calculate the Pareto efficient size of the park in acres. b. Assuming that both Ben and Tem are truthful, how much would each pay for the efficient size of the park? What would be the total amount paid by the group? c. Sketch a diagram that shows each person's demand for acres and the Pareto efficient outcome. d. Explain how the size of the park might be different if the size of the park were determined by voluntary contributionsThe following table shows how much utility Taran gets from watching his favorite teams, measured in "utils" (units of satisfaction). Team Manchester United Seattle Kraken Seattle Mariners. Seattle Seahawks Seattle Sounders. Seattle Storm Utils 68 81 78 64 72 86 Suppose Taran can only watch one of his favorite teams play. Assuming the cost to watch each team is the same, which team will Taran choose to watch?Explain, with the aid of a graph, how a negative research finding about the impact of homemade masks on peoples’ health will affect the demand for homemade masks
- 4. Two individuals, Amir and Budi, consume two goods, clothes (X) and shoes (Y). The utility functions for the two individuals are given as: Utility function of Amir, UA = 15X0.25Y0.75Utility function of Budi, UB = 25X0.5Y0.5 The current price for clothes (Px) is Rp 100,000 and the current price for shoes (PY) is Rp 150,000 a. Determine marginal rate of substitution (MRSXY)between clothes (X) and shoes (Y) for Amir and Budi! Please explain. b. Amir is currently consuming 5 units of clothes (X) and 10 units of shoes (Y), whereas Budi is consuming 12 units of clothes (X) and 8 units of shoes (Y). At this current consumption, have Amir and Budi reached the efficient allocation of clothes and shoes? If they have, explain why. If they have not, calculate the optimal allocation and explain. c. Considering the relative price between of clothes and shoes, at the current consumption, have Amir and Budi reached exchange equilibrium? Please explain d. Use the Edgeworth Box to illustrate the…Imagine that you are buying Lego bricks. The number of bricks you are willing to buy is determined by the market price of bricks. Your willingness to buy is defined by the following: You are willing to buy 1 brick if the price is at or below $30 You are willing to buy 2 bricks if the price is at or below $25 You are willing to buy 3 bricks if the price is at or below $20 You are willing to buy 4 bricks if the price is at or below $15 What is your consumer surplus if the market price of bricks is $23? Assume that there are enough sellers available to sell as many as you want to buy at that price. Enter the number below. Do not include the “$” sign.What happens if a consumer's income increases and the supply remains constant?