Economics: Principles, Problems, & Policies (McGraw-Hill Series in Economics) - Standalone book
20th Edition
ISBN: 9780078021756
Author: McConnell, Campbell R.; Brue, Stanley L.; Flynn Dr., Sean Masaki
Publisher: McGraw-Hill Education
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Question
Chapter 3, Problem 3DQ
To determine
Law of supply and a shape of the supply curve.
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a.
b.
Test Your Understanding
Price
Supply 1
$4.00
60
4.25
70
4.50
80
4.75
90
(5.00
100
5.25
110
5.50
120
What are equilibrium price and quantity?
Supply increases by 50% - what are the new equilibrium
price and quantity?
Demand
140
130
120
110
100
90
80
2014 McGraw-Hill Ryerson Limited
Supply 2
LO6
2-45
4. How will each of the following changes in demand and/or
supply affect equilibrium price and equilibrium quantity in a
competitive market; that is, do price and quantity rise, fall,
or remain unchanged, or are the answers indeterminate be-
cause they depend on the magnitudes of the shifts? Use sup-
ply and demand to verify your answers. LO3.5
a. Supply decreases and demand is constant.
b. Demand decreases and supply is constant.
c. Supply increases and demand is constant.
d. Demand increases and supply increases.
e. Demand increases and supply is constant.
f. Supply increases and demand decreases.
Will the equilibrium price of orange juice increase or decrease in each of the following situations? LO7a.
A medical study reporting that orange juice reduces cancer is released at the same time that a freak storm destroys half of the orange crop in Florida.
The prices of all beverages except orange juice fall in half while unexpectedly perfect weather in Florida results in an orange crop that is 20 percent larger than normal.
Chapter 3 Solutions
Economics: Principles, Problems, & Policies (McGraw-Hill Series in Economics) - Standalone book
Ch. 3.6 - Prob. 1QQCh. 3.6 - Prob. 2QQCh. 3.6 - Prob. 3QQCh. 3.6 - Prob. 4QQCh. 3.A - Prob. 1ADQCh. 3.A - Prob. 2ADQCh. 3.A - Prob. 3ADQCh. 3.A - Prob. 4ADQCh. 3.A - Prob. 5ADQCh. 3.A - Prob. 6ADQ
Ch. 3.A - Prob. 7ADQCh. 3.A - Prob. 1ARQCh. 3.A - Prob. 2ARQCh. 3.A - Prob. 3ARQCh. 3.A - Prob. 4ARQCh. 3.A - Prob. 5ARQCh. 3.A - Prob. 6ARQCh. 3.A - Prob. 1APCh. 3.A - The following table shows two demand schedules for...Ch. 3.A - Prob. 3APCh. 3 - Prob. 1DQCh. 3 - Prob. 2DQCh. 3 - Prob. 3DQCh. 3 - Prob. 4DQCh. 3 - Prob. 5DQCh. 3 - Prob. 6DQCh. 3 - Prob. 7DQCh. 3 - Prob. 8DQCh. 3 - Prob. 1RQCh. 3 - Prob. 2RQCh. 3 - Prob. 3RQCh. 3 - Prob. 4RQCh. 3 - Prob. 5RQCh. 3 - Prob. 6RQCh. 3 - Prob. 7RQCh. 3 - Prob. 8RQCh. 3 - Prob. 9RQCh. 3 - Prob. 1PCh. 3 - Prob. 2PCh. 3 - Prob. 3PCh. 3 - Prob. 4PCh. 3 - Prob. 5PCh. 3 - Prob. 6PCh. 3 - Prob. 7P
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Similar questions
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- Note: Price (P) is on the vertical axis and quantity (Q) is on the horizontal axis. (? 40 35 30 25 20 15 10 + + 5 10 15 20 25 30 35 40 QUANTITY The slope of this line is PRICE LOarrow_forwardSuppose that the incomes of buyers in a particular market for a normal good decrease and there is also a reduction in input prices. What would we expect to occur in this market? Select one: O a. Equilibrium quantity would decrease, but the impact on equilibrium price would be ambiguous. cross out O b. The equilibrium price would decrease, but the impact on the amount sold in the market would be ambiguous. cross out cross out O c. Equilibrium quantity would increase, but the impact on equilibrium price would be ambiguous. cross out O d. The equilibrium price would increase, but the impact on the amount sold in the market would be ambiguous.arrow_forwardWhat will happen to the equilibrium price and quantity of traditional camera film if traditional camneras become more expensive, digital cameras become cheaper, the cost of the resources needed to manufacture traditional film falls, and more firms decide to manufacture traditional film? Select one: O a. Quantity will rise, and the effect on price is ambiguous. O b. Price will fall, and the effect on quantity is ambiguous. O c. Quantity will fall, and the effect on price is ambiguous. O d. Price will rise, and the effect on quantity is ambiguous.arrow_forward
- Suppose that the incomes of buyers in a particular market for an inferior good increase and there is also an increase in input prices. What would we expect to occur in this market? Select one: O a. The equilibrium price would increase, but the impact on the amount sold in the market would be ambiguous. O b. The equilibrium price would decrease;but the impact on the amount sold in the market would be ambiguous. out Oc Equilibrium quantity would increase, but the impact on equilibrium price would be ambiguous. O d. Equilibrium quantity would decrease, but the impact on equilibrium price would be ambiguousarrow_forwardSuppose that a major luxury car producer exits the market in order to produce more economy cars. At the same time, a market research group reports that the average price of a luxury car is increasing, and the number of luxury cars sold is increasing. What must be happening to supply and demand. O The supply curve shifts to the left, and the demand curve shifts to the left. O The supply curve shifts to the left, and the demand curve shifts to the right. O Only the supply curve shifts to the left. O Only the supply curve shifts to the right.arrow_forwardThe figure belov WS suppl i demand curves for bread. Spplyginal con 35 30 25 00 O 1 00 2000 1000 4000 so00 4000 7.000 LO00 R000 10000 Quantity of loaves Q You will not be given credit unless you provide a detailed explanation for the following questions! a) What are the equilibrium price and the equilibrium quantity in the bread market? How can you tell? Is there excess supply or excess demand in the bread market when the price of bread is 2.5 euros? Why? Explain how price, quantity demanded and quantity supplied will adjust to reach equilibrium when the price is b) 2.5 euros. Initially, the bread market is in equilibrium. Suppose that there is technological improvement in the production process of bread. Explain how supply and demand curves, equilibrium price and equilibrium quantity change as result.arrow_forward
- Which one of the following statements is correct? O A. A fall in the price of a good will result in a rightward shift of the demand curve, ceteris paribus (i.e. the demand for the product will increase). O B. A rise in the price of a good will cause the supply curve of that good to shift to the right (i.e. the supply of the good will increase). O C. A decrease in the prices of the factors of production used to produce a certain product will give rise to an increase in the supply of the product (illustrated by a rightward shift of the supply curve). O D. Demand is a synonym for wants. In other words, if a consumer demands a good it simply means that he or she wants the good.arrow_forwardIn recent years the consumption of cobalt, which is used in the manufacture of batteries for electric automobiles, has risen but the price of cobalt has fallen. This is because the supply of cobalt has ______ and the demand for cobalt has____ B) decreased: also decreased O C increased; decreased A) decreased increased O D) increased: also increasedarrow_forwardSuppose there are two consumers in the market for a good, consumer 1's inverse demand function is p=80 – 24, and consumer 2s inverse demand function is p =36 - : Suppose further that the inverse market supply is p 20 + q. What is the competitive equilibrium? Oa. Competitive equilibrium price is 28 and competitive equilibrium quantity is 8 O b. Competitive equilibrium price is 40 and competitive equilibrium quantity is 8 O C Competitive equilibrium price is 40 and competitive equilibrium quantity is 20 O d. Competitive equilibrium price is 28 and competitive equilibrium quantity is 20arrow_forward
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