4. If a drought destroys tea crops causing an increase in the price of tea the (demand/quantity demand) for sugar will (increase / decrease). 5. If a new study shows that eating dark chocolate promotes a healthier lifestyle, the (demand/quantity demand) for Ghirardelli 92% Intense Dark bars at Chocoly Candy Shop will (increase / decrease). 6. If the Federal Reserve announces that the economy is booming and unemployment is at an all time low, the (demand/quantity demand) for cars will (increase/ decrease).

4. If a drought destroys tea crops causing an increase in the price of tea the (demand/quantity demand) for sugar will (increase / decrease). 5. If a new study shows that eating dark chocolate promotes a healthier lifestyle, the (demand/quantity demand) for Ghirardelli 92% Intense Dark bars at Chocoly Candy Shop will (increase / decrease). 6. If the Federal Reserve announces that the economy is booming and unemployment is at an all time low, the (demand/quantity demand) for cars will (increase/ decrease).

Managerial Economics: A Problem Solving Approach

5th Edition

ISBN:9781337106665

Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Chapter8: Understanding Markets And Industry Changes

Section: Chapter Questions

Problem 8.3IP: Hand Sanitizer Due to the H1N1 flu outbreak, the demand for hand sanitizer has tripled. Should...

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Question Earlier this year, 2021, the price of chicken meat rose unexpectedly reached to 250/ kilo at peak from the previous price of 170/ kilo. This 68% increase of price per kilo was primarily caused by excess demand for chicken meat. This is the result of the decrease in consumption for pork meat due to the threat of African Swine Flu (ASF). However, even though consumer shifted preferences, the increase in the price of chicken was perceived to be too high for the budget of consumers. Therefore, sellers realized decrease in their daily aggregate sales from 1,000 kilos to 700 kilos. 1. Illustrate the change in the market equilibrium through a graph. 2. What presumably happened to the total revenues of the sellers during the price hike period? a.) Compute the price elasticity of demand b.) Derive the total revenue before the hike (TR1), and after the hike (TR2).
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Hand Sanitizer Due to the H1N1 flu outbreak, the demand for hand sanitizer has tripled. Should Johnson & Johnson increase production of their Purell hand sanitizer? Should it invest in doubling production capacity?