Chapter 3: Q. 13 (page 78)
What does a downward-sloping demand curve mean about how buyers in a market will react to a higher price?
Short Answer
Buyers will demand less.
Chapter 3: Q. 13 (page 78)
What does a downward-sloping demand curve mean about how buyers in a market will react to a higher price?
Buyers will demand less.
All the tools & learning materials you need for study success - in one app.
Get started for freeReview Figure 3.4. Suppose the government
decided that, since gasoline is a necessity, its price
should be legally capped at $1.30 per gallon. What do you anticipate would be the outcome in the gasoline market?
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 pounds at every price.
(b) A new study says that eating cheese is good for your health, so that demand increases by 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?
What is the relationship between quantity
demanded and quantity supplied at equilibrium? What is
the relationship when there is a shortage? What is the
relationship when there is a surplus?
In an analysis of the market for paint, an economist discovers the facts listed below. State whether each of these changes will affect supply or demand, and in what direction.
a. There have recently been some important cost-saving inventions in the technology for making paint.
b. Paint is lasting longer, so that property owners need not repaint as often.
c. Because of severe hailstorms, many people need to repaint now.
d. The hailstorms damaged several factories that make paint, forcing them to close down for several months.
What do you think about this solution?
We value your feedback to improve our textbook solutions.