Macroeconomics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN: 9781305506756
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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11.3.2 Quiz: Specialization
Question 5 of 10
Which term describes a business's decision to focus on producing a small
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A. Opportunity cost
B. Specialization
C. Voluntary exchange
D. Self-sufficiency
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