Question 1

$$\begin{array} { | l | l | l | } 
\hline \begin{array} { l } 
\text { Price } \
\text { (dollars per } \
\text { pound of } \
\text { cat food) }
\end{array} & \begin{array} { l } 
\text { Quantity } \
\text { demanded } \
\text { (tons of cat } \
\text { food per } \
\text { year) }
\end{array} & \begin{array} { l } 
\text { Quantity } \
\text { supplied } \
\text { (tons of cat } \
\text { food per } \
\text { year) }
\end{array} \
\hline 1.00 & 52 & 15 \
\hline 1.50 & 46 & 26 \
\hline 2.00 & 43 & 34 \
\hline 2.50 & 40 & 30 \
\hline 3.00 & 35 & 44 \
\hline
\end{array}$$
-The above table gives the demand and supply schedules for cat food. If the price is $3.00 per pound of cat food, will there be a shortage, a surplus, or is this price the equilibrium price? If there is a shortage, how much is the shortage? If there is a surplus, how much is the surplus? If $3.00 is the equilibrium price, what is the equilibrium quantity?

Accepted Answer

The answer of \[\begin{array} { | l | l |...

Question 2

$$\begin{array} { | l | l | l | } 
\hline \begin{array} { l } 
\text { Price } \
\text { (dollars per } \
\text { pound of } \
\text { cat food) }
\end{array} & \begin{array} { l } 
\text { Quantity } \
\text { demanded } \
\text { (tons of cat } \
\text { food per } \
\text { year) }
\end{array} & \begin{array} { l } 
\text { Quantity } \
\text { supplied } \
\text { (tons of cat } \
\text { food per } \
\text { year) }
\end{array} \
\hline 1.00 & 52 & 15 \
\hline 1.50 & 46 & 26 \
\hline 2.00 & 43 & 34 \
\hline 2.50 & 40 & 30 \
\hline 3.00 & 35 & 44 \
\hline
\end{array}$$
-The above table gives the demand and supply schedules for cat food. If the price is $1.00 per pound of cat food, will there be a shortage, a surplus, or is this price the equilibrium price? If there is a shortage, how much is the shortage? If there is a surplus, how much is the surplus? If $3.00 is the equilibrium price, what is the equilibrium quantity?

Accepted Answer

The answer of \[\begin{array} { | l | l |...

Question 3

$$\begin{array} { | l | l | l | } 
\hline \begin{array} { l } 
\text { Price } \
\text { (dollars per } \
\text { pound of } \
\text { cat food) }
\end{array} & \begin{array} { l } 
\text { Quantity } \
\text { demanded } \
\text { (tons of cat } \
\text { food per } \
\text { year) }
\end{array} & \begin{array} { l } 
\text { Quantity } \
\text { supplied } \
\text { (tons of cat } \
\text { food per } \
\text { year) }
\end{array} \
\hline 1.00 & 52 & 15 \
\hline 1.50 & 46 & 26 \
\hline 2.00 & 43 & 34 \
\hline 2.50 & 40 & 30 \
\hline 3.00 & 35 & 44 \
\hline
\end{array}$$
-The above table gives the demand and supply schedules for cat food. If the supply increases by 20 tons at every price, what is the new equilibrium price and quantity?

Accepted Answer

The answer of \[\begin{array} { | l | l |...

Question 4

If the equilibrium relative price for a two-liter bottle of Coca-Cola is $1.50 today, just like it was ten years ago, can we safely say that all supply and demand conditions in the market for Coke have remained very stable all these years?

Accepted Answer

The answer of If the equilibrium relative price for a...

Question 5

What is the effect on the price and quantity of a product if both the demand and supply simultaneously increase?

Accepted Answer

The answer of What is the effect on the price...

Question 6

ʺIf the price of crude oil falls, the demand for gasoline will increase, so people will by more gas and the price of gas will go up.ʺ Is this statement true or false? Explain.

Accepted Answer

The answer of ʺIf the price of crude oil falls,...

Question 7

What is the effect on the price and quantity of a product if the demand decreases and the supply simultaneously increases?

Accepted Answer

The answer of What is the effect on the price...

Question 8

The price of a computer is $1,000 and the price of a car is $12,000. What is the relative price of a car? What is the relative price of a computer?

Accepted Answer

The answer of The price of a computer is $1,000...

Question 9

Soft drinks are a normal good. Draw a graph showing the effect of an increase in income on the demand for soft drinks.

Accepted Answer

The answer of Soft drinks are a normal good. Draw...

Question 10

-The diagram above illustrates the market for apartments in Victoria, British Columbia.
a) If the current rent is $300 per month, is there a shortage or surplus in the apartment market and how much is the shortage or surplus?
b) What is the equilibrium rent and quantity of apartments?

Accepted Answer

The answer of 
-The diagram above illustrates the market for...

Question 11

Personal computers are becoming less expensive as new technology reduces the cost of production. In a supply and demand model, explain the effects of the technological innovations and their effect on the quantity of computers.

Accepted Answer

The answer of Personal computers are becoming less expensive as...

Question 12

-In the figure above, if the price is $8 a unit, is there a shortage or surplus and what is the amount of any shortage or surplus? What is the equilibrium price and quantity?

Accepted Answer

The answer of 
-In the figure above, if the price...

Question 13

Soft drinks and milk are substitutes for consumers. Draw a graph showing the effect of an increase in the price of milk on the demand for soft drinks.

Accepted Answer

The answer of Soft drinks and milk are substitutes for...

Question 14

Computers are a complement to computer software. Suppose the price of a computer falls. Simultaneously, suppose that the number of companies selling computer software decreases. How do these changes affect the price and quantity of computer software?

Accepted Answer

The answer of Computers are a complement to computer software....

Question 15

Last year a very severe ice storm hit the north counties of New York state, and the states of Vermont and Maine. Electric poles were down and no one had power for days. It was reported that the price of kerosene heaters skyrocketed and the number purchased increased during this time. Using a supply and demand diagram, show the impact of the ice storm on the market for kerosene heaters.

Accepted Answer

The answer of Last year a very severe ice storm...

Question 16

Suppose the market for CD-Rs has the demand and supply schedules shown in the table above. What is the equilibrium price and the equilibrium quantity in this market?
Suppose the current price is $2.00. What is the quantity of CD-Rs sold? Explain. Is there a shortage or a surplus? How big is it? Explain.

Accepted Answer

The answer of Suppose the market for CD-Rs has the...

Question 17

In early 2009 the price of computer memory chips rose. In a demand and supply model, shifts in what curves) could have brought about the higher price?

Accepted Answer

The answer of In early 2009 the price of computer...

Question 18

In the market for bicycles, explain what happens to the supply and demand curves when there is an increase in the price of steel used to make bikes.

Accepted Answer

The answer of In the market for bicycles, explain what...

Question 19

Consumers can use either natural gas or heating oil to warm their houses. Suppose the price of natural gas increases. Use a demand and supply diagram to show the impact of the higher price of natural gas on the market for home heating oil. $$\begin{array} { | l | l | l | } 
\hline \begin{array} { l } 
\text { Price (dollars per } \
\text { disk) }
\end{array} & \begin{array} { l } 
\text { Quantity } \
\text { demanded } \
\text { (millions of disks } \
\text { per month) }
\end{array} & \begin{array} { l } 
\text { Quantity supplied } \
\text { (millions of disks } \
\text { per month) }
\end{array} \
\hline 0.50 & 50 & 0 \
\hline 1.00 & 40 & 15 \
\hline 1.50 & 30 & 30 \
\hline 2.00 & 20 & 45 \
\hline 2.50 & 10 & 60 \
\hline 3.00 & 0 & 75 \
\hline
\end{array}$$

Accepted Answer

The answer of Consumers can use either natural gas or...

Question 20

$$\begin{array} { | l | l | l | } 
\hline \begin{array} { l } 
\text { Price } \
\text { (dollars per } \
\text { pound of } \
\text { cat food) }
\end{array} & \begin{array} { l } 
\text { Quantity } \
\text { demanded } \
\text { (tons of cat } \
\text { food per } \
\text { year) }
\end{array} & \begin{array} { l } 
\text { Quantity } \
\text { supplied } \
\text { (tons of cat } \
\text { food per } \
\text { year) }
\end{array} \
\hline 1.00 & 52 & 15 \
\hline 1.50 & 46 & 26 \
\hline 2.00 & 43 & 34 \
\hline 2.50 & 40 & 30 \
\hline 3.00 & 35 & 44 \
\hline
\end{array}$$
-The above table gives the demand and supply schedules for cat food. What is the equilibrium price and quantity?

Accepted Answer

The answer of \[\begin{array} { | l | l |...

Quiz 3: Demand and Supply

If the equilibrium relative price for a two-liter bottle of Coca-Cola is $1.50 today, just like it was ten years ago, can we safely say that all supply and demand conditions in the market for Coke have remained very stable all these years?

What is the effect on the price and quantity of a product if both the demand and supply simultaneously increase?

ʺIf the price of crude oil falls, the demand for gasoline will increase, so people will by more gas and the price of gas will go up.ʺ Is this statement true or false? Explain.

What is the effect on the price and quantity of a product if the demand decreases and the supply simultaneously increases?

The price of a computer is $1,000 and the price of a car is $12,000. What is the relative price of a car? What is the relative price of a computer?

Soft drinks are a normal good. Draw a graph showing the effect of an increase in income on the demand for soft drinks.

-The diagram above illustrates the market for apartments in Victoria, British Columbia. a) If the current rent is $300 per month, is there a shortage or surplus in the apartment market and how much is the shortage or surplus? b) What is the equilibrium rent and quantity of apartments?

Personal computers are becoming less expensive as new technology reduces the cost of production. In a supply and demand model, explain the effects of the technological innovations and their effect on the quantity of computers.

-In the figure above, if the price is $8 a unit, is there a shortage or surplus and what is the amount of any shortage or surplus? What is the equilibrium price and quantity?

Soft drinks and milk are substitutes for consumers. Draw a graph showing the effect of an increase in the price of milk on the demand for soft drinks.

Computers are a complement to computer software. Suppose the price of a computer falls. Simultaneously, suppose that the number of companies selling computer software decreases. How do these changes affect the price and quantity of computer software?

In early 2009 the price of computer memory chips rose. In a demand and supply model, shifts in what curves) could have brought about the higher price?

In the market for bicycles, explain what happens to the supply and demand curves when there is an increase in the price of steel used to make bikes.