Explain price determination in a competitive market, and show how equilibrum changes in response to changes in determinants of demand and supply.
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Q: create your own scenario of the determinant of demand and determinant of supply.
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- Explain price determination in a competitive market, and show how equilibrium changes in response to changes in determinants of demand and supply.The price of strawberries has risen by 50% in the last month. Using a supply/demand graph and the Four Step approach, illustrate the results of this change in the market. Mark any changes to equilibrium.Enumerate Similarities of the concept of demand and concept of supply.
- Why would a shift in supply or demand happen as a result in a market equilibrium with higher prices but lower sales volume?Shifting Supply Directions: Determine how each of the following scenarios will impact supply for the market indicated. Graph the shift on the graph, label each graph, identify the shifter and indicate if supply will increase, decrease or not change. EXAMPLE Market: bicycles Scenario: New machinery cuts production time of bicycle chains in half. 1. Market: Bread Scenario: A drought hits the Midwest and destroys 1/3 of wheat crops. 2. Market: Oil Scenario: Producers expect the price of oil to increase in six months. 3. Market: Hybrid Cars Scenario: The government has enacted a program that gives subsidies to producers of fuel efficient cars. 4. Market: Desktop Computers Scenario: An increase in demand for laptops causes laptop prices to increase 125%. 5. Market: Cereal Scenario: Three new manufacturers enter the breakfast cereal market. P VEL S Vy P P S S₁ Shifter: Technology S P v V S S S Q Q Q Q Name. Date Q Q Change in Supply: Increase Shifter: urce Change in Supply: Decrease Shifter:…Q: How does the equilibrium price of a product vary if the demand for this product does not change and at the same time the production costs increase?
- Use the supply and demand model to predict how each of the following events would affect the auto market. Tell whether the demand or supply curve shifts, whether it is an increade and decrease, and report your predicted changes in price and quantity. 1. The price of gasoline falls significantly. 2. Improved technology raises productivity on auto assembly lines by 20% 3. The government starts giving sizable subsidies to public transportation.The introduction of new technology can affect the amount of supply a business will produce. Will it cause the supply curve to increase or decrease?Suppose we are analyzing the market for hot chocolate. Producers expect the price of hot chocolate to increase next month. The impact of the previous scenario on demand or supply will
- Tangi Tumolo carves and creates beautiful furniture on the island of Kiribati. Each month he takes the furniture to the capital city of South Tawara and sells what he can for the best prices he can. He also takes orders from people each month to build certain furniture indicating what is currently in demand. Each month the prices and products vary a bit depending on the demand in the market. Tangi enjoys the ebb and flow of the changing market as it keeps his business interesting and current with demand. Kiribati’s government takes a ‘hands off’ approach with the economy and the market is thriving on its own. Tangi Tumolo lives in what type of economy? Free Market Command Closed MixedThe post should be of 200-300 words Should a business owner always sell products at the equilibrium point of the supply and demand curves? Why or why not? Give insightful and well thought-out responses to support your claim.What sort of shift in supply or demand would result in a market equilibrium with higher prices but lower sales volume? What might cause such a shift?
