MICROECONOMICS
11th Edition
ISBN: 9781266686764
Author: Colander
Publisher: MCG
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Question
Chapter 4, Problem 3IP
(a)
To determine
Determine what would the recall likely do to the
(b)
To determine
The effect of the decision of the government to issue the remaining stamps when it could not recall all the stamps.
(c)
To determine
Effects of government’s decision on stamp holders’ actions.
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Students have asked these similar questions
Imagine you are a bank manager. Currently, your bank holds $8 million in deposits at a 4% interest rate. However, you need to increase the total deposits to $10 million. The interest rate elasticity of savings is 40.
What interest rate should you offer to depositors to obtain the required amount, all other things being equal?
Demand is likely to be price elastic if:
1. the buyers can use normal inflation to explain the price increase
2. buyers do not readily notice price changes
3. buyers think a higher price is justified by quality differences
4. there are many alternatives and direct substitutes for the product
5. buyers are slow to change their purchasing habits
Use the following demand function to answer questions 3-4. Show all your work to receive full
credit.
Qpork= 5.2 – 1.47Ppork + 1.82Peef + 0.18Pchicken + 0.38/
Calculate the cross-price elasticity of pork demand with respect to beef if the price
of pork is $3.78/lb., the price of beef is $6.15/1b., the price of chicken is $1.90/lb., disposable
income is $48000 per capita, and the total quantity demanded of pork is 52 lbs. per capita.
If the price of beef increases by 12%, how much would you expect the quantity
demanded of pork to change (in lbs.)?
Chapter 4 Solutions
MICROECONOMICS
Ch. 4.1 - Prob. 1QCh. 4.1 - Prob. 2QCh. 4.1 - Prob. 3QCh. 4.1 - Prob. 4QCh. 4.1 - Prob. 5QCh. 4.1 - Prob. 6QCh. 4.1 - Prob. 7QCh. 4.1 - Prob. 8QCh. 4.1 - Prob. 9QCh. 4.1 - Prob. 10Q
Ch. 4 - Prob. 1QECh. 4 - Prob. 2QECh. 4 - Prob. 3QECh. 4 - Prob. 4QECh. 4 - Prob. 5QECh. 4 - Prob. 6QECh. 4 - Prob. 7QECh. 4 - Prob. 8QECh. 4 - Prob. 9QECh. 4 - Prob. 10QECh. 4 - Prob. 11QECh. 4 - Prob. 12QECh. 4 - Prob. 13QECh. 4 - Prob. 14QECh. 4 - Prob. 15QECh. 4 - Prob. 16QECh. 4 - Prob. 17QECh. 4 - Prob. 18QECh. 4 - Prob. 19QECh. 4 - Prob. 20QECh. 4 - Prob. 21QECh. 4 - Prob. 22QECh. 4 - Prob. 23QECh. 4 - Prob. 24QECh. 4 - Prob. 1QAPCh. 4 - Prob. 2QAPCh. 4 - Prob. 3QAPCh. 4 - Prob. 4QAPCh. 4 - Prob. 5QAPCh. 4 - Prob. 6QAPCh. 4 - Prob. 1IPCh. 4 - Prob. 2IPCh. 4 - Prob. 3IPCh. 4 - Prob. 4IPCh. 4 - Prob. 5IP
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- Jackson, MS New York, NY P. P. $500 $100 Records made by Robert Johnson, a blues artist from the 1930s, are prized by collectors. A cache of these records is discovered in Mississippi, Johnson's home state, and the increased supply pushes the equilibrium price of these records in the Jackson area to $100. In New York, however, these records are trading for $500 each. What do you expect to happen? Select one: O a. People will buy records in New York and sell them in Jackson. O b. Nothing. These markets are too far away from each other. O c. Rich New Yorkers will buy all the records. O d. People will buy records in Jackson and sell them in New York. Check MacBook Pro Search or type URL 2$ &arrow_forwardIf a company is running short of funds and they want to increase revenue. Should you increase or decrease the price of their product? Explain your answer.arrow_forwardRomeo has typical preferences over chocolates C and flowers F, with the associated utility function U (C, F) = 3CF +10C + 6F. The price of chocolates is $5 per piece, and the price of flowers is $3 per stalk. He has $90 to spend on chocolates and flowers on Valentine's Day. Suppose his utility does not include any other goods. Fill in the blanks. At these prices, Romeo will purchase_____ pieces of chocolates and stalks of flowers. (Round to at least 2 decimal places.) Chocolates:arrow_forward
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- Bill O'Really of OX News observed that poultry (chicken and turkey) consumption in the US increased dramatically over the 2000 to 2006 period. This he believed was due to the fact that consumers, being more health conscious, switched from red meat to poultry, in an effort to eat healthier foods. Intrigued by these findings, Bill contacted the US Department of Agriculture for additional information. The department provided him with data that yielded two findings. First, there was a 75% decrease in the price of poultry over the period and second, there was widespread adoption of cost reducing innovations in poultry processing. Being a supposedly brilliant journalist, Bill concluded that the demand curve for poultry had shifted to the right. a. Is Bill's conclusion correct or incorrect? Explain your answer using supply and demand diagrams (best to use two diagrams in your answer). ANS:arrow_forwardTell whether demands are increase or decreasing . Answer 4,5,6,7arrow_forwardIf the percent rise in price is larger than the percent decline in quantity, then: the demand for your product could be either elastic or inelastic. the demand for your product is elastic. the demand for your product is inelastic. the demand for your product could be neither elastic nor inelastic.arrow_forward
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