Economics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN: 9781305506725
Author: James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher: Cengage Learning
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Question
Chapter 3, Problem 1CQ
(a)
To determine
The change in
(a)
Expert Solution
Explanation of Solution
An increase in the price of pork would lead to a fall in the quantity demanded of pork. This would result in an increase in the quantity demanded of beef as beef and pork are treated as substitutes by the consumers.
Economics Concept Introduction
Substitute good: Substitute goods refer to a good with a positive cross-
(b)
To determine
The change in income of the consumer and demand for beef.
(b)
Expert Solution
Explanation of Solution
An increase in the consumer income results in an increase in the quantity demanded of beef. This is due to the reason that the income of the consumer is a factor that influence the demand for a commodity.
(c)
To determine
The change in price of cattle feed and demand for beef.
(c)
Expert Solution
Explanation of Solution
An increase in the price of feed grains leads to an increase in the price of cattle fee. This implies that the cost of rearing cattle increases and this would be reflected in the price of beef. The increase in the cost of cattle rearing results in a decrease in the demand for beef. Thus, the increase in price of cattle feed leads to a fall in the demand for beef.
(d)
To determine
The outbreak of cattle disease and demand for beef.
(d)
Expert Solution
Explanation of Solution
The outbreak of cattle diseases such as mad cow or hoof- and mouth disease would lead to a fall in the demand for beef as the consumers’ preference for beef declines.
(e)
To determine
The increase in price of beef and demand for beef.
(e)
Expert Solution
Explanation of Solution
An increase in the price of beef would result in a fall in the demand for beef as stated by the
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Responsd to Luis Rodriguez
1800 tons of pomegranates a year is a lot of sweetness!
So, you can get 71 Afghanis for $1? How cool. Does that mean you can buy a lot of stuff in Afghanistan for only $1? How do you know that your purchasing power in Afghanistan is stronger than in the United States?
Yes, with an exchange rate of 71 Afghan Afghani for 1 US dollar, you can buy many things in Afghanistan for just $1. However, purchasing power isn't solely determined by the exchange rate. It also depends on the cost of goods and services in each country. For example, if a meal in Afghanistan costs 200 Afghanis, you would need about $2.82 to buy that meal in US dollars (since 200 Afghanis divided by 71 Afghanis per dollar equals approximately $2.82). So, while the exchange rate allows you to get more Afghanis for your dollars, you also need to consider how much things cost in Afghanistan.
Now that the world seems to like Afghani stuff and is buying more of it, does that mean your…
Chapter 3 Solutions
Economics: Private and Public Choice (MindTap Course List)
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