Economics: Private and Public Choice
16th Edition
ISBN: 9781337642224
Author: James D. Gwartney; Richard L. Stroup; Russell S. Sobel
Publisher: Cengage Learning US
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Chapter 4, Problem 15CQ
To determine
Impact of subsidy on spinach.
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Final Exam (4 HR) (page 24 of 26) - Google Chrome
mpuslife.ca/Ims/mod/quiz/attempt.php?attempt-6982998cmid=14397319&page=23
The demand schedule for sugar is:
24°C
The demand schedule for sugar is:
Price
(dollars per kilogram)
3
5
9
12
Quantity Demanded
(millions of kilograms per year)
20
Paragraph
a. What happens to total revenue if the price of sugar rises from $3 to $7 per kile
c. At what price is total revenue a maximum?
16
12
b. What happens to total revenue if the price rises from $7 to $12?
BIEE
3
2
Answer all four:Use the data below to answer the following questions:
Price
Quantity Supplied
$4
4
$7
13
Calculate the price elasticity of supply when the price rises from $4 to $7. Round your answer to the nearest hundredth.
Is the price elasticity of supply elastic or inelastic?
The government wants to increase production of this good. Would it make more sense to offer a subsidy or a tax?
Based on your previous answers, would the government plan to increase production be likely to be effective or ineffective? Explain your answer.
The Organization for the Promotion of Brussels Sprouts has convinced the government of Ironia to institute a price floor on the sale of Brussels sprouts at $8 per bushel. Demand is given by:P = 9 – Qand supply by:P = 2Q,where Q is measured in thousands of bushels.Instructions: Round your answers to the nearest whole number.a. At market equilibrium, the price is $ per bushel and the equilibrium quantity is thousand bushels.b. With the price floor, the price is $ per bushel and the quantity sold is thousand bushels.c. The excess quantity supplied of Brussels sprouts produced with the price floor is thousand bushels.
Chapter 4 Solutions
Economics: Private and Public Choice
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- Suppose that when price is 10, quantity supplied is 20 units, and when the price is 6, the quantity supplied is 12 units. What is the price elasticity of supply? a. 0.5 b. 0.8 c. 1.0 d. 1.5arrow_forwardThe graph below represents the supply of Good X. The numbers on the chart show the percent changes in price and quantity moving along the supply curve. The numbers below the horizontal lines indicate the percent change in quantity, while the numbers to the right of the vertical lines indicate the percent change in price. c Price Supply E D 35% 25% 30% 30% B A 32% 30% 37% 35% Show Transcribed Text Quantity Which portion of the supply curve for Good A is unitary elastic? Select the correct answer below: Point A to Point B Point B to Point C Point C to Point D Point D to Point Earrow_forwardThe demand and supply schedules for gatorade is as follows: Price (Gallons) Quantity Supplied $90 888888 80 70 60 50 40 Quantity Demanded 20 88888 25 30 35 40 55 65 339*** 55 45 35 25 15 What is the equilibrium price of gatorade? What is the equilibrium quantity? The city of Fayetteville is worried about the effectiveness of gatorade in thirst quenching young adults. They set a price floor $20 above equilibrium. How much gatorade is sold? in? Thirsty young adults seekers protest to the decision so the city imposes a price calling $10 lower than the price floor from the previous question. How much gatorade is sold? What effect does this resultarrow_forward
- The graph below pertains to the supply of paper to colleges and universities. price quantity Refer to the graph shown here. All else equal, an increase in the price of the pulp used in the paper production process would cause a move from x to y. y to x. SA to SB. SB to SA.arrow_forwardI need some help understanding the elasticity of demand and supply. I need more resources that explain the basics and then move into more difficult concepts with economics. Thank you- Jamie Haysarrow_forwardHow will a simultaneous increase in the price of a substitute good and an improvement in production technology affect market demand and/or supply, equilibrium price and equilibrium quantity in a competitive market?arrow_forward
- help please answer in text form with proper workings and explanation for each and every part and steps with concept and introduction no AI no copy paste remember answer must be in proper format with all workingarrow_forwardThe data in the table shows the price and quantity supplied for exercise balls. Using the Midpoint Method, what is the price elasticity of supply from point C to point D? Note: Remember to take the absolute value of the result and round to the nearest hundredth. If using a calculator, rounding should be done at the end of your calculation. Provide your answer below: Point Price $30 A B C D E $32 834 $3 $38 Quantity 10,000 10, 100 10,200 10,300 10,040arrow_forwardWhat is price legislation?arrow_forward
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