Question (1): Suppose the estimated quantity demand for potato chips is Q = 140 – 15p and the quantity supply function for potato chips is Q = 115 + 10p. Find the equilibrium price and quantity for the number of bags of potato chips. Suppose that the main costs of producing potato chips are labor and potatoes. On a per unit basis, the cost of producing and manufacturing a bag of potato chips rises by $1.50. The firms are citing higher labor costs and fewer potatoes are grown due to the poor climate. What will be the new equilibrium price and quantity? Whichever curve you think a shift will occur, derive the new function. Suppose that a health news piece has been published indicating the ill effects of consuming potato chips. The news has been published after the firms incurred the higher costs of production. Consumers are being advised to consume popcorn or pretzels instead of potato chips. How would that affect the market for potato chips? Going back to question (c), suppose that the market has determined that the new fair price for a bag of potato chips is $1.40. How many bags of potato chips will be demanded by consumers and whichever curve you’ve decided to receive its shift, derive the new function?
Question (1): Suppose the estimated quantity demand for potato chips is Q = 140 – 15p and the quantity supply function for potato chips is Q = 115 + 10p. Find the equilibrium price and quantity for the number of bags of potato chips. Suppose that the main costs of producing potato chips are labor and potatoes. On a per unit basis, the cost of producing and manufacturing a bag of potato chips rises by $1.50. The firms are citing higher labor costs and fewer potatoes are grown due to the poor climate. What will be the new equilibrium price and quantity? Whichever curve you think a shift will occur, derive the new function. Suppose that a health news piece has been published indicating the ill effects of consuming potato chips. The news has been published after the firms incurred the higher costs of production. Consumers are being advised to consume popcorn or pretzels instead of potato chips. How would that affect the market for potato chips? Going back to question (c), suppose that the market has determined that the new fair price for a bag of potato chips is $1.40. How many bags of potato chips will be demanded by consumers and whichever curve you’ve decided to receive its shift, derive the new function?
Chapter16: Labor Markets
Section: Chapter Questions
Problem 16.7P
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THIS EXERCISE FOR MATHEMATICAL ECONOMIC :
Question (1):
Suppose the estimated quantity
- Find the
equilibrium price and quantity for the number of bags of potato chips. - Suppose that the main costs of producing potato chips are labor and potatoes. On a per unit basis, the cost of producing and manufacturing a bag of potato chips rises by $1.50. The firms are citing higher labor costs and fewer potatoes are grown due to the poor climate. What will be the new equilibrium price and quantity? Whichever curve you think a shift will occur, derive the new function.
- Suppose that a health news piece has been published indicating the ill effects of consuming potato chips. The news has been published after the firms incurred the higher costs of production. Consumers are being advised to consume popcorn or pretzels instead of potato chips. How would that affect the market for potato chips?
- Going back to question (c), suppose that the market has determined that the new fair price for a bag of potato chips is $1.40. How many bags of potato chips will be demanded by consumers and whichever curve you’ve decided to receive its shift, derive the new function?
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