Chapter 3: Q.15 (page 78)
Will supply curves have the same shape in all
markets? If not, how will they differ?
Short Answer
The figure of a supply curve changes depending upon how supply differences in reaction to varying prices.
Chapter 3: Q.15 (page 78)
Will supply curves have the same shape in all
markets? If not, how will they differ?
The figure of a supply curve changes depending upon how supply differences in reaction to varying prices.
All the tools & learning materials you need for study success - in one app.
Get started for freeTable 3.10 shows the supply and demand for movie tickets in a city. Graph demand and supply and identify the equilibrium. Then calculate in a table and graph the effect of the following two changes.
a. Three new nightclubs are open. They offer decent bands and have no cover charge, but make their money by selling food and drink. As a result, demand for movie tickets falls by six units at every price.
b. The city eliminates a tax that is placed on all local entertainment businesses. The result is that the quantity supplied of movies at any given price increases by 10%.
Name some factors that can cause a shift in the supply curve in markets for goods and services.
Table 3.9 illustrates the market's demand and supply for cheddar cheese. Graph the data and find the equilibrium. Next, create a table showing the change in quantity demanded or quantity supplied, and a graph of the new equilibrium, in each of the following situations:
(a) The price of milk, a key input for cheese production, rises, so that the supply decreases by 80 pounds at every price.
(b) A new study says that eating cheese is good for your health, so that demand increases by 20% at every price.
Price per pound | Qd | Qs |
---|---|---|
\(3.00 | 750 | 540 |
\)3.20 | 700 | 600 |
\(3.40 | 650 | 650 |
\)3.60 | 620 | 700 |
\(3.80 | 600 | 720 |
\)4.00 | 590 | 730 |
Does a price ceiling change the equilibrium price?
Use the four-step process to analyze the impact of a reduction in tariffs on imports of iPods on the equilibrium price and quantity of Sony Walkman-type products.
What do you think about this solution?
We value your feedback to improve our textbook solutions.