Economics For Today
10th Edition
ISBN: 9781337613040
Author: Tucker
Publisher: Cengage Learning
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Chapter P2, Problem 3KC
To determine
The
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Text Problem 19-16
An increase in the market price of men's haircuts, from $16 per haircut to $26 per haircut, initially causes a local barbershop to have its employees work overtime to
increase the number of daily haircuts provided from 25 to 30. When the $26 market price remains unchanged for several weeks and all other things remain equal as
well, the barbershop hires additional employees and provides 45 haircuts per day.
What is the short-run price elasticity of supply?
(Your answer should have two decimal places.)
Draw a supply and demand graph showing an equilibrium price of $50 and an equilibrium quantity of 200 units. Explain what would happen if the selling price was $75, and illustrate this on the graph. Explain what would happen if the selling price was $25, and illustrate this on the graph. Be sure to label each axis and curve on the graph.
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- Consider the weekly supply of gasoline in Figure 1. How much gasoline will producers wish to sell if the price of a gallon of gasoline is $1.70? A) 100K gallons B) 140K gallons C) 236K gallons D) 308K gallonsarrow_forwardThe market equilibrium point for a product is reached when 6000 units are produced and sold at $21 per unit. The manufacturer will not produce any units at the price of $5, and the customers will not buy any at the price of $69. Find the supply and demand equations, assuming they are linear. The equations should express price p in terms of quantity q. a. Supply equation P= b. Demand equation P=arrow_forwardit is not 28.6arrow_forward
- In the supply equation; [Qdx=Px+1600], if Qdx=5688, then the price of the product is. Select one: a. 9100800.00 b. 4088.00 c. -4088.00 d. 7288.00arrow_forwardRefer to the figure below, which shows the market for a specific good. What will be the result if the producer prices this product at $70? Price $100 90 80 70 60 50 40 30 20 10 0 10 20 30 40 50 60 70 80 90 100 Quantity per period Select one: There will be an upward pressure on the price b. The consumers plan to buy 70 units There will be a shortage of 40 units d. 50 units will be bought and sold None of the above O e. a.arrow_forwardThe demand for computers is QD=13−2P, where P is the price of computers. Initially, the supply of computers is QS=4+P. Use the demand equation above to plot the demand curve. 1.) Using the line drawing tool, accurately draw the demand curve. Draw the curve for quantities from at least 1 to 11. Properly label your line. 2.) Using the point drawing tool, indicate the equilibrium price and quantity. Label your point 'E1'. Carefully follow the instructions above and only draw the required objects. The equilibrium price is... per computer. (Round your response to one decimal place.) The equilibrium quantity is......computers per week. (Roundyour response to the nearest nteger.) Suppose the prices of memory chips and motherboards (two important components in computers) rise and as a consequence, the supply curve for computers becomes QS=P. In a supply-and-demand diagram, accurately show the effect of the increase in the prices…arrow_forward
- Projected Effects of Different Prices on Sales Increased Price or Increased Sales? An increase in the price of an item may not produce an increase in sales revenue. Price per Item x Quantity Sold Sales Revenue $50 200 $10,000 $45 250 $11,250 $40 280 $11,200 $35 325 $11,375 $30 400 $12,000 $25 500 $12,500 Explain why an increase in price does not always mean an increase in revenue.arrow_forwardUse the demand curve below to answer questions 1 through 6. price 12- 10- 8 6- 4- 2- 0 0 50 100 150 200 250 quantity What is the percent change in price when the price drops from $6 to $5? Assume your answer is a percent and enter a numeric value only.arrow_forwardThe task I am struggling with. Thank you.arrow_forward
- The demand for pocket calculators is given by the function: P = 6 - 0.5Qd; and the supply is given by the function: 6 = Qs - P; where = Qd = quantity demanded, Qs= quantity supplied and P = price. Calculate the demand and supply for calculators if the market price is $15 per barrel. What problem exists in the economy? What would you expect to happen to price?arrow_forwardIf the demand for a pair of shoes is given by 2p + 5q = 200 and the supply function for it is p − 2q = 10, compare the quantity demanded and the quantity supplied when the price is $70. quantity demanded ? pairs of shoes quantity supplied ? pairs of shoes Will there be a surplus or shortfall at this price? There will be a surplus or There will be a shortfallarrow_forwardWhat are the potential effects in the market for automobiles if consumers experience a decrease in their income. a) draw a supply/demand graph of the automobile market. b)indicate starting equilibrium price and equilibrium quantity. c) analyze graphically the effect of the change given above on equilibrium price and equilibrium quantity in the automobile market.arrow_forward
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