Principles of Economics (12th Edition)
12th Edition
ISBN: 9780134078779
Author: Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher: PEARSON
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Textbook Question
Chapter 5, Problem 2.8P
Studies have fixed the short-run
- a. If gasoline were selling for $2.30 per gallon before the cutoff, how much of a price increase would you expect to see in the coming months?
- b. Suppose that the government imposes a
price ceiling on gas at $2.30 per gallon. How would the relationship between consumers and gas station owners change?
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*8. Studies have fixed the short-run price elasticity of demand for
gasoline at the pump at -0.20. Suppose that international hos-
tilities lead to a sudden cutoff of crude oil supplies. As a result,
U.S. supplies of refined gasoline drop 10 percent.
a. If gasoline were selling for $2.60 per gallon before the cutoff,
how much of a price increase would you expect to see in the
coming months?
b. Suppose that the government imposes a price ceiling on gas
at $2.60 per gallon. How would the relationship between
consumers and gas station owners change?
14
Studies have fixed the short-run price elasticity of demand for HPV vaccines at -0.25 . Suppose that transportation issues lead to a sudden cutoff of vaccine supplies. As a result, supplies of HPV vaccines drop 20 percent.
a. If HPV vaccines were selling for 130 dollar per dose before the cutoff, how much of a price increase would you expect to see in the coming months?
b. Suppose that the government imposes a price ceiling on HPV vaccines at 130 dollar per dose. How would the relationship between vaccine recipients and hospital/clinic owners change?
Assume that the demand curve is a straight line. If the price per unit of a good rises from $2.40 to 3.00, it is expected that monthly demand will fall from 250,000 units to 200,000 units. What is the point price elasticity of demand when the price is $2.40? What is the arc price elasticity of demand over these ranges of price and output? Is the demand for this good price sensitive?
Chapter 5 Solutions
Principles of Economics (12th Edition)
Ch. 5 - Prob. 1.1PCh. 5 - Prob. 2.1PCh. 5 - Prob. 2.2PCh. 5 - Using the midpoint formula, calculate elasticity...Ch. 5 - A sporting goods store has estimated the demand...Ch. 5 - For each of the following scenarios, decide...Ch. 5 - For the following statements, decide whether you...Ch. 5 - Taxicab fares in most cities are regulated....Ch. 5 - Studies have fixed the short-run price elasticity...Ch. 5 - Prob. 2.9P
Ch. 5 - Prob. 2.10PCh. 5 - Prob. 2.11PCh. 5 - [Related to the Economics in Practice on p. 99] At...Ch. 5 - Prob. 3.2PCh. 5 - Prob. 4.1PCh. 5 - Prob. 4.2PCh. 5 - The cross-price elasticity values for three sets...Ch. 5 - Prob. 4.4PCh. 5 - World famous Burpee Beer is brewed in the small...Ch. 5 - Prob. 5.2P
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- Consider the following supply schedule: What is the price elasticity of supply between a. P = 10 and P = 8? b. P = 8 and P = 6? c. P = 6 and P = 4? d. P = 4 and P = 2? e. P = 2 and P = 0?arrow_forwardThe price elasticity of demand for personal computers is estimated to be 2.2. If the price of personal computers declines by 20 percent, what will be the expected percentage increase in the quantity of computers sold?arrow_forwardSuppose 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_forward
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