Assignment OverviewIn this assignment, you will examine the effects of changes in demand and supply on the equilibrium price and quantity of a market.Step 1Analyze the effect of each scenario on the price of khaki pants.Consider the following scenarios. Think about how each scenario would affect the price of khaki pants.A new technology reduces the time it takes to make a pair of khaki pants.The price of the cloth used to make khaki pants falls.The wage rate paid to garment workers increases.The price of jeans increases.People's incomes increase.Step 2Draw a demand-supply graph and label the axes with the price and quantity of khaki pants.Create one graph that shows each of the demand-supply curves for the five scenarios listed in Step 1.Use (free) online graphing software such as "Padowan" to create your graph.Follow the instructions on the website to learn how to create and manipulate the graph.Use five different colors to represent each of the five scenarios.Save the graph to your computer as a jpeg file.Copy and paste the jpeg into the assignment document that you deliver to your instructor.Clearly identify your finished graph.Step 3Address the following statements related to the graph.Below the graph, in the same document, address the following questions relating to your graph:Does each event change demand, supply, both, or neither? Explain your choice.Does the event increase or decrease demand and/or supply? Explain your answer.How does this change in demand and/or supply affect the equilibrium prices and quantity within the market?Compare the new demand curve or supply curve by drawing it on the same graph.Find the new equilibrium and compare it with the original one in terms of equilibrium price and quantity and explain your findings.

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ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Assignment Overview

In this assignment, you will examine the effects of changes in demand and supply on the equilibrium price and quantity of a market.

Step 1

Analyze the effect of each scenario on the price of khaki pants.

Consider the following scenarios. Think about how each scenario would affect the price of khaki pants.

A new technology reduces the time it takes to make a pair of khaki pants.
The price of the cloth used to make khaki pants falls.
The wage rate paid to garment workers increases.
The price of jeans increases.
People's incomes increase.

Step 2

Draw a demand-supply graph and label the axes with the price and quantity of khaki pants.

Create one graph that shows each of the demand-supply curves for the five scenarios listed in Step 1.

Use (free) online graphing software such as "Padowan" to create your graph.
Follow the instructions on the website to learn how to create and manipulate the graph.
Use five different colors to represent each of the five scenarios.
Save the graph to your computer as a jpeg file.
Copy and paste the jpeg into the assignment document that you deliver to your instructor.
Clearly identify your finished graph.

Step 3

Address the following statements related to the graph.

Below the graph, in the same document, address the following questions relating to your graph:

Does each event change demand, supply, both, or neither? Explain your choice.
Does the event increase or decrease demand and/or supply? Explain your answer.
How does this change in demand and/or supply affect the equilibrium prices and quantity within the market?
Compare the new demand curve or supply curve by drawing it on the same graph.
Find the new equilibrium and compare it with the original one in terms of equilibrium price and quantity and explain your findings.

Definition Video Definition Point where the demand and supply curves intersect. At the equilibrium price the quantity supplied of a good is equal to the quantity demanded. When the market is not in equilibrium, market surplus or market shortage occurs. The region that is above the price equilibrium indicates market surplus and the region below the price equilibrium indicates market shortage. Video

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