Principles of Macroeconomics (11th Edition)
11th Edition
ISBN: 9780133023671
Author: Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher: PEARSON
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Question
Chapter 3, Problem 10P
Subpart (a):
To determine
Quantity demand and quantity supply.
Subpart (b):
To determine
Subpart (c):
To determine
Illustration of equilibrium point.
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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.
Suppose the demand and supply curves for rice in Japan are given by the following equations:Qd = 100-30PQs = 40 + 10PWhere Qd = million tons of rice the Japanese would like to buy each year; Qs = million tons of rice the Japanese farmers would like to sell each year; P = Price per ton of rice (in hundreds).a. Fill in the following table:(Photo)b. Use the information in the table to find the equilibrium price and quantity.c. Graph the demand and supply curves and identify the equilibrium price and quantity and the total revenue.
Select one:a. $92.5b. $53.5c. $32.5d. $82.5
Chapter 3 Solutions
Principles of Macroeconomics (11th Edition)
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