Microeconomics
11th Edition
ISBN: 9781260507140
Author: David C. Colander
Publisher: McGraw Hill Education
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Question
Chapter 4, Problem 9QE
(a)
To determine
Determination of market
(b)
To determine
Explain the
(c)
To determine
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You will analyze the Market for Gasoline
Step 1: Draw a supply-and-demand diagram. Price is on the vertical axis, quantity is on the horizontal axis, demand is downward-sloping, supply is upward-
sloping, and be sure to label equilibrium price and equilibrium quantity.
Step 2. Change colors! If you have a highlighter or colored pencil (crayon, sharpie, whatever).
Step 3. Show the change in demand or supply (only one curve will shift in each scenario). State if the curve decreases or increases.
Step 4: Show the new equilibrium price and equilibrium quantity.
Step 5: Repeat Steps 1-4 for each scenario. You will have a total of 4 graphs.
Scenario A: A hurricane destroys refineries that produce gasoline.
Scenario B: Consumers purchase electric vehicles that do not need gasoline.
• Scenario C: Technological innovation occurs that reduces the cost of producing gasoline.
Scenario D: Road trips become the one and only vacation option and many families opt for long-distance road trips.
●
.
Draw the supply and demand graph in equilibrium for a single market. Identify the equilibrium price and quantity. Make sure to label the axis as well as the curves.
What impact did the advent of online video rentals and streaming have on the in-store movie industry? Use the demand and supply diagram to illustrate your answer. Pay attention to how the equilibrium quantity and price adjust. Make state all your assumptions.
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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- a. Is the quantity demanded higher or lower than at the equilibrium price? b. What about the quantity supplies? c. Is there a shortage in the market? If so, how much?arrow_forwardIllustrate the effect on the equilibrium price and quantity using supply and demand curves. Be sure to label everything. Use the 4 step process.arrow_forwardDraw a supply and demand graph for the market for air travel. Analyze the impact of an increase in the cost of jet fuel. Be sure to use just one graph, shifting either the demand curve or the supply curve the correct direction. Show the impact on equilibrium price and equilibrium quantity.arrow_forward
- Draw a supply and demand diagram with price on the vertical axis. 1. Show what happens in your diagram when the price of a substitute good increases. 2. What happens to the market price and quantity in your diagram?arrow_forwardProblem 2 The following table shows the behavior of buyers and sellers in a Pizzeria. price per pizza in $ 0.5 1 1.5 2 2.5 3 3.5 quantity requested 280 260 225 170 105 60 35 quantity available 40 135 225 265 290 310 320 a- Draw the demand and supply curves, name the axes. Interpret the shape of the two curves. b- What is the equilibrium price and quantity. c- If the price was initially set at $2, explain how can we return to equilibrium? d- If the price was initially set at $0.5, explain how can we return to equilibrium?arrow_forwardDraw a demand and supply graph, label all axes, and the equilibrium price and quantity. Once you have done this draw what would happen if there was a decrease in the number of buyers in the marketarrow_forward
- carefully explain what is happening in the following market.indicate the impact if any on demand, supply price and quantity: In the market for housing, house prices are expected to increase significantly in the neat future. choose the suitable answer for question 1,2,3 &4 Questions: 1) impact on supply 2) impact on demand 3) impact on price 4) impact on quantity Answer: a. decrease equilibrium quantity b.excess supply c. increase equilibrium quantity d. decrease towards equilibrium e.increase towards equilibrium f. change in price in uncertain g.decrease equilibrium price h.excess demand i. change in quantity uncertain j.increase equilibrium price k. no impact l.shift outwards/ to right m.shift inwards/to leftarrow_forwardFollowing an increase in supply and an increase in demand, the market is producing more at a lower price. What must have happened? Selected answer will be automatically saved. For keyboard navigation, press up/down arrow keys to select an answer. a The change in demand was larger than the change in supply. b The change in demand was smaller than the change in supply. c There is no reason to think that either change was larger than the other. d Some other change must have occurred.arrow_forwardPlease help me to answer. See the attached photo belowarrow_forward
- carefully explain what is happening in the market for tea. indicate the impact if any on demand, supply,price and quantity .coffee and tea are demand substitutes. coffee plantations increase the supply of coffee. choose the suitable answer. 1) Impact on demand a. decrease equilibrium quantity b.excess supply c. increase equilibrium quantity d. decrease towards equilibrium e.increase towards equilibrium f. change in price in uncertain g.decrease equilibrium price h.excess demand i. change in quantity uncertain j.increase equilibrium price k. no impact l.shift outwards/ to right m.shift inwards/to leftarrow_forwardDescribe the factors that can effect demand and supply, what are their impacts on market equilibrium?arrow_forwardQuestion The market for disposal digital cameras has the following demand and supply schedules: Price Quantity Demanded Quantity Supplied $ 5 10 15 20 25 30 35 15 13 11 9 7 5 3 0 3 6 9 12 15 18 a. Graph the demand and supply curves. What are the equilibrium price and quantity in this market? b. Explain what would happen if the market price is set at $30, and show this on the graph. c. Explain what would happen if the market price is set at $15, and show this on the graph.arrow_forward
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