Economics (Irwin Economics)
21st Edition
ISBN: 9781259723223
Author: Campbell R. McConnell, Stanley L. Brue, Sean Masaki Flynn Dr.
Publisher: McGraw-Hill Education
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Question
Chapter 3, Problem 7RQ
To determine
Demand and change in demand.
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Check out a sample textbook solutionStudents have asked these similar questions
3. Refer to the expanded table below from review question 8.
LO3.4
a. What is the equilibrium price? At what price is there nei-
ther a shortage nor a surplus? Fill in the surplus-shortage
column and use it to confirm your answers.
b. Graph the demand for wheat and the supply of wheat. Be
sure to label the axes of your graph correctly. Label equi-
librium price Pand equilibrium quantity Q.
c. How big is the surplus or shortage at $3.40? At $4.90?
How big a surplus or shortage results if the price is 60
cents higher than the equilibrium price? 30 cents lower
than the equilibrium price?
Thousands
of Bushels
Surplus (+)
or
Shortage (-)
Thousands
Price per
Bushel
of Bushels
Supplied
Demanded
85
$3.40
72
80
3.70
73
75
4.00
75
70
4.30
77
65
4.60
79
60
4.90
81
Note: Price (P) is on the vertical axis and quantity (Q) is on the horizontal axis.
(?
40
35
30
25
20
15
10
+
+
5
10
15
20
25
30
35
40
QUANTITY
The slope of this line is
PRICE
LO
Next, complete the following graph, labeled Scenario 2, by shifting the supply and demand curves in the same way that you did on the Scenario 1
graph.
PRICE (Dollars per pen)
10
9
8
co
LO
5
+
3
2
1
0
0
1
Price
Quantity
2
Equilibrium Object
True
Scenario 2
3
False
Supply
4
5
6
7
QUANTITY (Millions of pens)
Demand
Scenario 1
8
9
Compare both the Scenario 1 and Scenario 2 graphs. Notice that after completing both graphs, you can now see a difference between them that
wasn't apparent before the shifts because each graph indicates different magnitudes for the supply and demand shifts in the market for pens.
10
Use the results of your answers on both the Scenario 1 and Scenario 2 graphs to complete the following table. Begin by indicating the overall change
in the equilibrium price and quantity after the shift in demand or supply for each shift-magnitude scenario. Then, in the final column, indicate the
resulting change in the equilibrium price and quantity when supply and demand shift in…
Chapter 3 Solutions
Economics (Irwin Economics)
Ch. 3.6 - Prob. 1QQCh. 3.6 - Prob. 2QQCh. 3.6 - Prob. 3QQCh. 3.6 - Prob. 4QQCh. 3.A - Prob. 1ADQCh. 3.A - Prob. 2ADQCh. 3.A - Prob. 3ADQCh. 3.A - Prob. 4ADQCh. 3.A - Prob. 5ADQCh. 3.A - Prob. 6ADQ
Ch. 3.A - Prob. 7ADQCh. 3.A - Prob. 1ARQCh. 3.A - Prob. 2ARQCh. 3.A - Prob. 3ARQCh. 3.A - Prob. 4ARQCh. 3.A - Prob. 5ARQCh. 3.A - Prob. 6ARQCh. 3.A - Prob. 1APCh. 3.A - The following table shows two demand schedules for...Ch. 3.A - Prob. 3APCh. 3 - Prob. 1DQCh. 3 - Prob. 2DQCh. 3 - Prob. 3DQCh. 3 - Prob. 4DQCh. 3 - Prob. 5DQCh. 3 - Prob. 6DQCh. 3 - Prob. 7DQCh. 3 - Prob. 8DQCh. 3 - Prob. 1RQCh. 3 - Prob. 2RQCh. 3 - Prob. 3RQCh. 3 - Prob. 4RQCh. 3 - Prob. 5RQCh. 3 - Prob. 6RQCh. 3 - Prob. 7RQCh. 3 - Prob. 8RQCh. 3 - Prob. 9RQCh. 3 - Prob. 1PCh. 3 - Prob. 2PCh. 3 - Prob. 3PCh. 3 - Prob. 4PCh. 3 - Prob. 5PCh. 3 - Prob. 6PCh. 3 - Prob. 7P
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Similar questions
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- Suppose an economic boom causes incomes to increase and, at the same time, drives up wages for the sales representatives who work for cell phone companies. Assume that smartphones are a normal good. This will cause the: O price of cell phones and the equilibrium quantity to rise. O price of cell phones to rise, but the change in the equilibrium quantity is unclear and depends on whether the shift in demand is larger or smaller than the shift in supply. O price of cell phones and the equilibrium quantity to fall. O quantity of cell phones to rise, but the change in the equilibrium price is unclear and depends on whether the shift in demand is larger or smaller than the shift in supply.arrow_forwardles of Macroeconomics - Spring21 Which of the following statements is CORRECT? Select one: O a. A change in the quantity demanded means a shift in the demand curve. O b. Achange in demand means a movement along the demand curve. O c. Achange in demand and change in quantity demanded means the same thing. O d. Achange in demand means a shift in the demand curve while change in the quantity demanded means a movement along the demand curve. NEXT PAGEarrow_forward4. How will each of the following changes in demand and/or supply affect equilibrium price and equilibrium quantity in a competitive market; that is, do price and quantity rise, fall, or remain unchanged, or are the answers indeterminate be- cause they depend on the magnitudes of the shifts? Use sup- ply and demand to verify your answers. LO3.5 a. Supply decreases and demand is constant. b. Demand decreases and supply is constant. c. Supply increases and demand is constant. d. Demand increases and supply increases. e. Demand increases and supply is constant. f. Supply increases and demand decreases.arrow_forward
- ADVANCED ANALYSIS Assume that demand for a commodity is represented by the equation P = 100-3Qd- Supply is represented by the equation P= -10 + 3Q,, where Qd and Qs are quantity demanded and quantity supplied, respectively, and Pis price. Instructions: Round your answer for price to 2 decimal places and enter your answer for quantity as a whole number. Using the equilibrium condition Qs Qd solve the equations to determine equilibrium price and equilibrium quantity. Equilibrium price = $ 50 Equilibrium quantity = 20 unitsarrow_forwardSuppose the residents of country P consume only peaches and pecans. The table below shows the prices and quantity of peaches and pecans consumed for two consecutive years. Note that all prices are per bushel. Suppose that the typical consumer basket consists of 10 bushels of peaches and 15 bushels of pecans. Assume 2000 is the base year. Year 2000 2001 Price $11 $9 O a. 100 O b. 200 O C 120 O d. 240 Peaches Quantity 10 20 What is the consumer price index for 2001? Price $6 $10 Pecans Quantity 10 10arrow_forwardThe price of a gallon of gasoline in California was $0.99 in 1997, and it is currently $3.69. By what factor have the prices increased? -3.73 O 72 O 27 3.73arrow_forward
- [MUST SHOW WORK] Consider the above table for the market for oranges. A deep frost destroys many or the orange juice businesses to go put of business. As a result, quantity supplied decreases hper kg and the new equilibrium quantiy is.........? kg of oranges The new equilibrium price is .............? kg of oranges Select one: O A. 1.70;400 O B. 1.10; 700 O C. 1.20;650 O D. 0.90;400 O E. 1.50;500arrow_forwardRefer to Exhibit 4-2. Exhibit 4-2 Price Supply D₁ Quantity D₂ If the supply curve shifts to the right, then which of the following is true? OD, results in the most decrease in the equilibrium price. D₁ results in the most increase in the equilibrium price. O D₂ results in the most decrease in the equilibrium price. O D₂ results in the most increase in the equilibrium price. O The change in the equilibrium price is the same for D, and D₂.arrow_forwardQuantity Demanded 6 7 8 9 10 11 12 Price $8 7 6 5 4 3 2 Refer to the above table. If demand decreased by 4 units at each price and supply decreased by 2 units at each price, what would the new equilibrium price and quantity be? Multiple Choice O $6 and 6 units $5 and 5 units O $4 and 6 units Quantity Supplied 10 9 8 7 6 5 4 $7 and 7 unitsarrow_forward
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