Microeconomics
21st Edition
ISBN: 9781259915727
Author: Campbell R. McConnell, Stanley L. Brue, Sean Masaki Flynn Dr.
Publisher: McGraw-Hill Education
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Question
Chapter 3.6, Problem 2QQ
To determine
Change in the supply due to changes in price.
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Draw a graph to analyze the market for agricultural products (food). Label your price and quantity axes properly. In your graph, draw a supply curve for agricultural products (food) that obeys the law of supply. Label (S). In the same graph, draw a demand curve for food that obeys the law of demand. Label (D). Identify the market equilibrium point in your graph and label (E). Also, label the equilibrium price (PE) and the Equilibrium quantity (QE):
1. The federal government instituted acreage restriction programs in an attempt to eliminate the surpluses resulting from the price support program. Using the graph above, explain and illustrate how acreage restrictions, if effective might reduce or eliminate food surpluses. Label and explain clearly.
Draw a graph to analyze the market for agricultural products (food). Label your price and quantity axes properly. In your graph, draw a supply curve for agricultural products (food) that obeys the law of supply. Label (S). In the same graph, draw a demand curve for food that obeys the law of demand. Label (D). Identify the market equilibrium point in your graph and label (E). Also, label the equilibrium price (PE) and the Equilibrium quantity (QE):
1. In response to farmers' outcries about declining food prices, the federal government instituted a farm price support program. Use the graph above to illustrate why farm price supports created surpluses of many agricultural products. Explain your graph in words and clearly identify the surplus in your graph.
Draw a graph to analyze the market for agricultural products (food). Label your price and quantity axes properly. In your graph, draw a supply curve for agricultural products (food) that obeys the law of supply. Label (S). In the same graph, draw a demand curve for food that obeys the law of demand. Label (D). Identify the market equilibrium point in your graph and label (E). Also, label the equilibrium price (PE) and the Equilibrium quantity (QE):
1. Using supply/demand analysis, explain why food prices declined in the United States in the 1920s. Use your above graph to illustrate the change in the market equilibrium price. Clearly label the original and new equilibrium price and explain your graphical analysis in words.
Chapter 3 Solutions
Microeconomics
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 - Prob. 2APCh. 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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- For a particular good, a 12 percent increase in price causes a 24 percent decrease in quantity demanded. Which of the following statements is most likely applicable to this good? a. The good is a luxury. b. There are not many substitutes for this good. c. The relevant time horizon is short. d. The market for the good is broadly defined.arrow_forwardWhich one of the following statements is incorrect?A. A demand curve illustrates the quantities demanded at different prices, on the assumption that all other possible influences on the quantity demanded remain unchanged.B. There is an inverse relationship between the price of the product and the quantity demanded of that product.C. A conventional demand curve normally slopes downward from left to right.D. The inverse relationship between the price of a product and the quantity demanded is called the law of demand.E. We cannot analyse the demand for a product without considering the availability of the product.arrow_forwardFor a particular good, a 2 percent increase in price causes a 12 percent decrease in quantity demanded. Which of the following statements is most likely applicable to this good? A. the good is a luxury B. the market for the good is broadly defined C. the relevant time horizon is short D. there are no good substitutes for this goodarrow_forward
- For a particular good, a 10 percent increase in price causes a 3 percent decrease in quantity demanded. Which of the following statements is most likely applicable to this good? a. The relevant time horizon is short. b. The good is a luxury. c. The market for the good is narrowly defined. d. There are many close substitutes for this good. Selected Answer: C. Carrow_forwardDemand for a product is most likely to increase because: A. the total number of consumers in a market declines. B. the product becomes unfashionable for consumers. C. consumers expect the future price to decline. D. demand for complementary goods rises.arrow_forwardThe figure shows the supply and demand for online music. Suppose that an economic downturn decreases household wealth and erodes consumer confidence. Move the supply and/or demand curves to reflect the primary effect this would have on the market for online music. You can assume that online music is a normal good. Also select the end result of equilibrium price and quantity. Equilibrium price Equilibrium quantity Price ($ per track) Quantity (number of tracks) Supply Demandarrow_forward
- The behavior of suppliers or producers to make products available for sale refers to: A. supply b.supply schedule. c. quantity supplied. d. supply curve.arrow_forwarda) an increase in supply. b) a decrease in quantity supplied. c) a decrease in supply. d) an increase in quantity supplied.arrow_forwardIncrease in supply usually __ the price and __ the quantity demanded.(A) lowers, lowers(B) raises, raises(C) lowers, raises(D) raises, lowersarrow_forward
- An increase in supply:A. indicates that more is supplied at higher prices.B. indicates that more is supplied at lower prices.C. indicates that more is supplied at all prices.D. is illustrated by an upward shift of the supply curve.E. is illustrated by a leftward shift of the supply curve.arrow_forwardThe demand schedule for a good: A. indicates the quantity that people will buy at the prevailing price. B. indicates the quantities that suppliers will sell at various market prices. C. is determined primarily by the cost of producing the good. D. indicates the quantities that will be purchased at alternative market prices. The price elasticity of demand measures the: A. responsiveness of quantity demanded to a change in quantity supplied. B. responsiveness of price to a change in quantity demanded. C. responsiveness of quantity demanded to a change in price. D. responsiveness of quantity demanded to a change in income. Refer to Figure 3-3. A change from Point A to Point E represents a(n): A. increase in supply. B. decrease in supply. C. increase in quantity supplied. D. decrease in quantity supplied.arrow_forwardThe task I am struggling with: Determine the supply and demand function and the equilibrium point.Graph the results.Demand. If a given product is priced at $7 per unit, there is a demand for 4 units;if a given product is priced at $6 per unit, there is a demand for 8 units.Supply. If a given product is priced at $9 per unit, suppliers are willing to produce4 units; if a given product is priced at $23 per unit, suppliers are willing toproduce 12 units. Thank you very much.arrow_forward
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