Foundations of Economics (8th Edition)
8th Edition
ISBN: 9780134486819
Author: Robin Bade, Michael Parkin
Publisher: PEARSON
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Question
Chapter 6, Problem 8SPPA
To determine
To find:
The way total surplus and the price of a sandbag can change.
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Students have asked these similar questions
Consider the market for minivans. Indicate the impact if any on demand, supply, price and quantity:
(a) People decide to have more children.
(b) A strike by steelworkers raises steel prices.
(c) Engineers develop new automated machinery for the production of minivans.
(d) The price of station wagons rises.
(e) A stock-market crash lowers people’s wealth ac
The market supply and demand for a product are shown in the diagram below.
PRICE $6 Supply
Demand 80 200 QUANTITY
(a) Is the price elasticity of supply less than one, equal to one, or greater than one? Explain. (b) Calculate consumer surplus at the equilibrium price. Show your work. (C) Now suppose the government imposes a per-unit tax of $1 on producers. (i) What happens to total revenue received by producers after they pay the tax to the government? Explain. (ii) Will producer surplus increase, decrease, or stay the same? (iii) Will total surplus increase, decrease, or stay the same? Explain.
Problem 2 The following table shows the behavior of
buyers and sellers in a Pizzeria.
price per pizza
in $
0.5
1
1.5
2
2.5
3
3.5
quantity
requested
280
260
225
170
105
60
35
quantity
available
40
135
225
265
290
310
320
a- Draw the demand and supply curves, name the axes.
Interpret the shape of the two curves.
b- What is the equilibrium price and quantity.
c- If the price was initially set at $2, explain how can we
return to equilibrium?
d- If the price was initially set at $0.5, explain how can we
return to equilibrium?
Chapter 6 Solutions
Foundations of Economics (8th Edition)
Ch. 6 - Prob. 1SPPACh. 6 - Prob. 2SPPACh. 6 - Prob. 3SPPACh. 6 - Prob. 4SPPACh. 6 - Prob. 5SPPACh. 6 - Prob. 6SPPACh. 6 - Prob. 7SPPACh. 6 - Prob. 8SPPACh. 6 - Prob. 9SPPACh. 6 - Prob. 10SPPA
Ch. 6 - Prob. 11SPPACh. 6 - Prob. 12SPPACh. 6 - Prob. 1IAPACh. 6 - Prob. 2IAPACh. 6 - Prob. 3IAPACh. 6 - Prob. 4IAPACh. 6 - Prob. 5IAPACh. 6 - Prob. 6IAPACh. 6 - Prob. 7IAPACh. 6 - Prob. 8IAPACh. 6 - Prob. 9IAPACh. 6 - Prob. 1MCQCh. 6 - Prob. 2MCQCh. 6 - Prob. 3MCQCh. 6 - Prob. 4MCQCh. 6 - Prob. 5MCQCh. 6 - Prob. 6MCQCh. 6 - Prob. 7MCQ
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