Macroeconomics
11th Edition
ISBN: 9781260506891
Author: Colander
Publisher: MCG
expand_more
expand_more
format_list_bulleted
Question
Chapter 5, Problem 7QE
To determine
Impact of drought on the equilibrium for rice.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Consider the world market for wheat, in which Russia is a larger producer. Suppose there is a major failure in Russia's wheat crop due to a severe drought. Explain the likely effect on the equilibrium price and quantity in the world wheat market. Also, explain why Canadian wheat farmers certainly benefit from this drought
The table shows the hypothetical demand and supply for coffee beans in two countries: Mexico and Armenia.
Price ($) per pound of coffee beans
Price ($/lb)
Mexico quantity demanded (lb)
Mexico quantity supplied (lb)
Armenia quantity demanded (lb)
Armenia quantity supplied (lb)
8
180
500
155
210
7
200
460
180
180
6
250
410
200
160
5
280
360
220
140
4
320
320
240
125
3
350
280
260
115
In autarky, what would the equilibrium price and quantity be in Mexico and Armenia?
equilibrium price in Mexico: $
equilibrium quantity in Mexico: lb
equilibrium price in Armenia: $
equilibrium quantity in Armenia: lb
Suppose that the Bahrain government reduces the tariff on imported coffee, and at the same time, the Health Ministry of Bahrain publishes a reputable study indicating that coffee drinkers have lower rates of colon cancer.
What will the combined impact be on the equilibrium price and quantity of coffee? Explain your reasoning and show it graphically. Make sure you think this through carefully!
Chapter 5 Solutions
Macroeconomics
Ch. 5.1 - Prob. 1QCh. 5.1 - Prob. 2QCh. 5.1 - Prob. 3QCh. 5.1 - Prob. 4QCh. 5.1 - Prob. 5QCh. 5.1 - Prob. 6QCh. 5.1 - Prob. 7QCh. 5.1 - Prob. 8QCh. 5.1 - Prob. 9QCh. 5.1 - Prob. 10Q
Ch. 5.A - Prob. 1QECh. 5.A - Prob. 2QECh. 5.A - Prob. 3QECh. 5.A - Prob. 4QECh. 5.A - Prob. 5QECh. 5.A - Prob. 6QECh. 5.A - Prob. 7QECh. 5.A - Prob. 8QECh. 5.A - Prob. 9QECh. 5 - Prob. 1QECh. 5 - Prob. 2QECh. 5 - Prob. 3QECh. 5 - Prob. 4QECh. 5 - Prob. 5QECh. 5 - Prob. 6QECh. 5 - Prob. 7QECh. 5 - Prob. 8QECh. 5 - Prob. 9QECh. 5 - Prob. 10QECh. 5 - Prob. 11QECh. 5 - Prob. 12QECh. 5 - Prob. 13QECh. 5 - Prob. 14QECh. 5 - Prob. 15QECh. 5 - Prob. 16QECh. 5 - Prob. 17QECh. 5 - Prob. 1QAPCh. 5 - Prob. 2QAPCh. 5 - Prob. 3QAPCh. 5 - Prob. 4QAPCh. 5 - Prob. 5QAPCh. 5 - Prob. 1IPCh. 5 - Prob. 2IPCh. 5 - Prob. 3IPCh. 5 - Prob. 4IPCh. 5 - Prob. 5IPCh. 5 - Prob. 6IPCh. 5 - Prob. 7IPCh. 5 - Prob. 8IPCh. 5 - Prob. 9IPCh. 5 - Prob. 10IPCh. 5 - Prob. 11IPCh. 5 - Prob. 12IPCh. 5 - Prob. 13IPCh. 5 - Prob. 14IP
Knowledge Booster
Similar questions
- Determine how the following affects the market for apples in the United States. While not required, you may wish to draw the supply and demand diagram for apples to assist in determining the impact on quantity and price. A new study shows significant health benefits from eating apples. Select one: a.Quantity increases and price increases b.Quantity increases and price decreases c.Quantity decreases and price increases d.Quantity decreases and price decreases Trade barriers restricting apples imports from Canada are eliminated. Select one: a.Quantity increases and price increases b.Quantity increases and price decreases c.Quantity decreases and price increases d.Quantity decreases and price decreases Genetically modified apples trees that allow for much greater output per tree without greater costs are introduced into the market. Select one: a.Quantity increases and price increases b.Quantity increases and price decreases c.Quantity decreases and price increases d.Quantity…arrow_forwardHow did an export ban on onion by India affected the price of local onion in Bangladesh? Can you show this change/ effect on a diagram? If demand for local onion increases during Eid (in future) what changes do you see in the above diagram (from question 2)? Will the supply curve be affected or the demand curve for local onion? If less rainfall limited the supply of Indian onion production, how will it change the equilibrium price in the Indian market? If Indian Government reduces export incentive, how will it affect/change demand or supply of onion in India in the free market? Show with a diagram Onion prices in Bangladesh are unlikely to come down unless prices fall in India with a bumper production. What can we do to reduce the onion price in BD? Is there a role of the government?arrow_forwardThe traditional diet of the citizens of the nation of Ironia includes a lot of red meat, and ranchers make up a vital part of Ironia's economy. The government of Ironia decides to support its ranchers through a price floor, which it will maintain by buying up excess meat supplies. The table below shows the supply and demand schedule for red meat; quantities are given in thousands of kilos. Quantity demanded (thousands of kg) Quantity supplied (thousands of kg) Price ($) 5 80 5 20 70 4 35 60 3 50 50 2 65 40 1 80 30 Instructions: Round your answers to the nearest whole number. a. How many thousands of kilos of meat would you recommend that the government purchase to keep the price at $4 per kilo? |thousand kilo b. How much money should the government budget for this program? %24arrow_forward
- For each of the following events described, indicate the effects to the demand and to the supply. Use the demand and supply graphs provided below to match these events. Then determine what happens to the market equilibrium price and equilibrium quantity. Scenario: As more and more people bought home computers during the 1990s, the demand for access to the World Wide Web and the Internet increased sharply. At same time, new companies like Earl's began to enter the internet-access market competing with older, more established services such as American Online. Despite a massive increase in demand, the price of access to the Web actually declined. Change in Demand* Increase Decrease Did not Change Indeterminate Change in Supply * Increase Decrease Did not Change Indeterminate Graph * Do Do A B A P So So Do Do So So S: Do E F E So So Di Do Do G O G Он So S1 So Do Do Q So Do D1 -Q K O K Change in market equilibrium price. * Increase O Decrease Did not Change O Indeterminate Change in market…arrow_forwardScenario 1: Because of a recent international trade agreement, the Indian government reduces the tariff on imported coffee. Do you think a reduction of tariff by the government affect the supply or the demand for coffee? If yes, why do you think so? Which determinant of demand or supply is being affected? How will this change the equilibrium price and quantity of coffee? Explain your reasoning and show the changes graphically. Scenario 2: Suppose the National Institutes of Health (NIH) publishes a study finding that coffee drinking reduces the probability of getting colon cancer. Do you think this will affect the market for coffee? If yes, why do you think so? Which determinant of demand or supply is being affected? How will this change the equilibrium price and quantity of coffee? Explain your reasoning and show the changes graphically. Scenario 3: Now, combine both the scenarios. In case if the Indian government reduces the tariff on imported coffee, and the recent study published by…arrow_forwardMuch of the demand for U.S. agricultural output has come from other countries. In 1998, the total demand for wheat was Q = 3244 - 283P. Of this, total domestic demand was QD = 1700 - 107P, and domestic supply was QS =1944 + 207P. Suppose the export demand for wheat falls by 40%. a. U.S. farmers are concerned about this drop in export demand. What happens to the free-market price of wheat in the United States? Do farmers have much reason to worry? b. Now suppose the U.S. government wants to buy enough wheat to raise the price to $3.50 per bushel. With the drop in export demand, how much wheat would the government have to buy? How much would this cost the government?arrow_forward
- Tornado Bulbul hits Bangladesh and affects the crops and fish hatcheries in the coastal areas. if a neighboring country, who exports crops and fishes to Bangladesh, experiences a bumper harvest and exports their surplus products to us, say shrimp, what will happen to the equilibrium price and quantity of local shrimp market again in Bangladesh? Draw a diagram and explain your answer.arrow_forward“Explain what will happen to the UK market price and market quantity of tea if there is an increase in the price of coffee combined with an increase in transportation cost in the country.”arrow_forwardThe weekly demand and supply schedules for T-shirts (in millions) in a free market are as follows: Price Quantity demanded Quantity supplied 8 6 18 7 8 16 6 10 14 5 12 12 4 14 10 3 16 8 2 18 6 1 20 4 4.Assume that changes in fashion cause the demand for T-shirts to rise by 4 million at each price. What will be the new equilibrium price and quantity? Has equilibrium quantity risen as much as the rise in demand? Explain why or why not. 5.Now plot the data in the table and mark the equilibrium. Also plot the new data corresponding to (b).arrow_forward
- In the following situations graphically illustrate what happens to the market for blankets in St. Lucia and explain how equilibrium price and quantity is affected. A flood damages the cotton crop in St. Lucia. The price of comforters falls significantly. A persistent heat wave occurred during the summer months. More efficient knitting machines were introduced on the market The number of blanket producers’ increase.arrow_forwardIn the North, if the price goes down by $0.20 per pound, then the quantity supplied in the North goes down by 200 pounds per year. If the price of cherries goes down by $0.20 in the South, what will happen to the quantity supplied? There is not enough information given to determine the supply change in the South. The quantity will decrease by 200 pounds per year. The quantity will increase by 200 pounds per year. The quantity will increase by 100 pounds per year.arrow_forwardGraphically illustrate and explain the impacts of simultaneous increase in market size (number of buyers) and technological advancement on the equilibrium market price and quantity of a commodity, such as automobiles in the USA.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Exploring EconomicsEconomicsISBN:9781544336329Author:Robert L. SextonPublisher:SAGE Publications, Inc
Economics (MindTap Course List)EconomicsISBN:9781337617383Author:Roger A. ArnoldPublisher:Cengage Learning
Exploring Economics
Economics
ISBN:9781544336329
Author:Robert L. Sexton
Publisher:SAGE Publications, Inc
Economics (MindTap Course List)
Economics
ISBN:9781337617383
Author:Roger A. Arnold
Publisher:Cengage Learning