Using SDM, show the impact of the demand shocks on the equilibrium of the auto market. Graphically show the change in consumers, producers, and total surplus. Notes: label the relevant areas of the graph and show the change in consumers, producers, and total surplus.
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Using SDM, show the impact of the demand shocks on the equilibrium of the auto market. Graphically show the change in
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- A change in consumer’s expectations causes a movement along the demand curve or a shift in the demand curve? Explain. A change in price of the goods results in a movement along the demand curve or a shift in the demand curve? Explain (Word count: 250 words max.) Buyers' expectations about future prices can affect the demand curve. If consumers expect prices to increase, they buy more of a product now, and the demand curve moves to the right. A demand schedule for a normal good is as follows: Price Quantity demanded Rs.230 70 210 90 190 110 170 130 Do you think that the increase in quantity demanded (say, from 90 to 110 in the table) when price decreases (from Rs.210 toRs.190) is due to a rise in consumers’ income? Explain clearly (and briefly) why or why not. Now suppose that the good is an inferior good. Would the demand schedule still be valid for…The Unique Gifts catalog lists a "super loud and vibrating alarm clock." Their records indicate the following information on the relation of monthly supply and demand quantities to the price of the clock. Demand Supply Price 166 131 $31 146 181 $43 Use this information to find the following. (a) points on the demand linear equation (x, p) (smaller x-value) (х, р) %3 (larger x-value) points on the supply linear equation (х, р) (smaller x-value) (x, p) = ( ) (larger x-value) (b) the demand equation p = (c) the supply equation p (d) the equilibrium quantity and price Equilibrium occurs when the price of the clock is $ and the quantity isSupply, Demand and Equilibrium Price Usually, the supply equation is modeled by a linear equation. Suppose you have done some market research for your product. How would you go about doing this research? Suppose you have found the following information about the supply base on the price: Price 1 dollar 4 dollars 6 dollars 9 dollars Supply 600 units 4200 units 6600 units 10200 units Write the linear equation that relates price and supply. What are the mathematical domain and range? What are the practical domain and range? Now the demand for a product is often inversely proportional to the price. When the price is too high, the demand for it often diminishes. Further market research gives you the following information about the demand based on the price.
- Discuss clearly how the following items may affects the change in demand. Tastes and preferences Income Seasonal products Population change Prices of related goods Expected future prices, income, and creditDiscuss clearly how the following items may affects the change in demand. Population change Prices of related goods Expected future prices, income, and creditSupply and Demand: End of Chapter Problems 4. Why would we see a decrease in demand for certain goods if incomes are rising in an economy? Because suppliers stop producing certain goods. when incomes are rising, people start saving more and reduce their consumption of all goods. some goods are inferior goods and consumers substitute normal goods for them when incomes are rising. when incomes are rising the demand for all goods increases. Thus, the statement is not true. a 81 64°F
- Draw a graph: new equilibrium price supply and demand where as quantity is predicted and unpredicted?Demand for cookies is of the following form: P=20-4QD, where QD is millions of cookies demanded per year and P is price in US dollars. Supply of cookies of the following form: P=6+Qs, where QS is millions of cookies supplied per year and P is price in US dollars. a. What is the equilibrium quantity of cookies traded? Solve the equation, showing your work. b. Graph the supply and demand curves, marking their intersection. Be sure to label intercepts, equilibrium, etc. c. The government imposes a tax of $2 per cookie on producers of cookies. What is the new equilibrium quantity of cookies traded? Solve the equation, showing your work. d. In a graph, show how the supply curve has shifted. What price do consumers now pay? After paying the tax, how much to producers receive.Draw and label a graph that depicts a downward-sloping demand curve and an upward-sloping supply curve in the market for sneakers. Assume that the market is initially in equilibrium Use the graph you drew to answer the previous question to show how a decrease in demand would cause a surplus in the market for sneakers. Explain how a decrease in price would eliminate the surplus The company started discounting more items... to deal with a continuing inventory glut... In the latest quarter sneaker revenue rose 5% from a year earlier... Holding everything else constant, if a decrease in the price of sneakers results in an increase in revenue from sales: (a) does this mean that the demand for sneakers is price-elastic or price-inelastic? (b) would the absolute value of the price elasticity of demand for sneakers be less than or greater than +1.0? Briefly explain your answers. Nike is planning future price increases to offset rising costs of labor and other inputs it uses to produce…
- Read the following extract and answer the questions that follow:Big fuel price hikes announced for Wednesday, 29 Nov 2021The petrol price will be hiked by 81c a litre on Wednesday, while diesel will go up by between 72.5c a litre (0.05% sulphur) and 74.5c (0.005% sulphur), the department of mineral resources and energy announced. The latest price hike will push the price of petrol - currently around R19.50 a litre - to above R20 in Gauteng and other inland provinces. At the start of November, petrol prices were hiked by R1.21, while diesel increased by R1.48. Illuminating paraffin will go up by 42.2c/l, while the maximum LP Gas retail price will be increased by 183.00c/kg from 1 December. Local fuel prices are determined by international oil prices - as well as the dollarrand value, as South Africa buys oil in dollar. The latest fuel price hikes are due in large part to a sharp fall in the rand against the dollar, which averaged at R15.85/$ over the past month, compared to R14.72 the…onsider the market for some product. Suppose the market demand and supply curves are as given below. e quantity is in million units. Demand: p= 18 - 4QD Supply: p=4+2Q⁹ Plot the demand and supply curves on a scale diagram. Compute the equilibrium price and quantity. ) Use the line drawing tool to draw and label these demand and supply lines in the graph at right. ) Use the point drawing tool to plot and label the equilibrium point. arefully follow the instructions above, and only draw the required objects. Price ($) 18.00- 16.00- 14.00- 12.00- 10.00- 8.00- 6.00- 4.00- 2.00- 0.00+ 0.0 1.0 2.0 3.0 Quantity (million units) 4.0 5.0 QQuestion 2Identify what sort of effects the following listed events have.You are required to define the market under study (for example: the labour market, oil market, etc). Explain whether the event acts on the demand or supply side, and whether the event leads to a quantity or price change, or leads to a shift in demand and/or supply.Make sure to explain what sort of assumptions you are making on the elasticities of demand and supply.a) An increase in oil prices as a consequence of a price dispute in the world oil marketsb) The implementation of a minimum wagec) The implementation of subsidies to milk producers in Australiad) The implementation of a Carbon tax in the economy. A Carbon tax is charged according to the level of emissions of greenhouse gases in an economy.e) The implementation of an increase in tuition in University studies