Macroeconomics: Principles, Problems, & Policies
20th Edition
ISBN: 9780077660772
Author: Campbell R. McConnell, Stanley L. Brue, Sean Masaki Flynn Dr.
Publisher: McGraw-Hill Education
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Chapter 3, Problem 7RQ
To determine
Demand and change in demand.
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In the following scenarios, you will be given a product and an event. Determine what will happen to the demand for the product based on the event, what happens to the demand curve, and give the non-price determinant that caused it to occur. (chose from the 7 determinants listed in the notes). The first one is answered for you as an example.
EXAMPLE/ Product - Hamburgers Event - The price of steak increases
EXAMPLE ANSWER/ Demand increases - Curve shifts right - Price of substitutes
Rock Salt - It snows 8 inches over night
In the following scenarios, you will be given a product and an event. Determine what will happen to the demand for the product based on the event, what happens to the demand curve, and give the non-price determinant that caused it to occur. (chose from the 7 determinants listed in the notes). The first one is answered for you as an example.
EXAMPLE/ Product - Hamburgers Event - The price of steak increases
EXAMPLE ANSWER/ Demand increases - Curve shifts right - Price of substitutes
Salt - The price of salt doubles.
2. Sunscreen - Summer approaches.
3. Big Macs - The population in the United States increases by 20%.
4. Rock Salt - It snows 8 inches over night
Label each of the following scenarios with the set of symbols that best indicates the price change and quantity change that occur in the scenario. In some scenarios, it may not be possible from the information given to determine the direction of a particular price change or a particular quantity change. We will symbolize those cases as, respectively, “P?” and “Q?”. The four possible combinations of price and quantity changes are: P ↓ Q? P? Q ↓ P ↑ Q? P? Q ↑ a. On a hot day, both the demand for lemonade and the supply of lemonade increase. b. On a cold day, both the demand for ice cream and the supply of ice cream decrease. c. When Hawaii’s Mt. Kilauea erupts violently, the demand on the part of tourists for sightseeing flights increases but the supply of pilots willing to provide these dangerous flights decreases. d. In a hot area of Arizona where they generate a lot of their electricity with wind turbines, the demand for electricity falls on windy days as people switch off their air…
Chapter 3 Solutions
Macroeconomics: Principles, Problems, & Policies
Ch. 3.A - Prob. 1ADQCh. 3.A - Prob. 2ADQCh. 3.A - Prob. 3ADQCh. 3.A - Prob. 4ADQCh. 3.A - Prob. 5ADQCh. 3.A - Prob. 6ADQCh. 3.A - Prob. 7ADQCh. 3.A - Prob. 1ARQCh. 3.A - Prob. 2ARQCh. 3.A - Prob. 3ARQ
Ch. 3.A - Prob. 4ARQCh. 3.A - Prob. 5ARQCh. 3.A - Prob. 6ARQCh. 3.A - Prob. 1APCh. 3.A - Prob. 2APCh. 3.A - Prob. 3APCh. 3.6 - Prob. 1QQCh. 3.6 - Prob. 2QQCh. 3.6 - Prob. 3QQCh. 3.6 - Prob. 4QQCh. 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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