Question
1.) The custom T-shirt printing business has many competitors, so that the perfect competition model may be considered a good approximation. Currently the market demand
1.) The custom T-shirt printing business has many competitors, so that the perfect competition model may be considered a good approximation. Currently the market demand curve is given byQ= 120- 1.5p, whereas the market supply is given byQ=-20+ 2p.
Suppose there is a T-shirt craze that increases demand by 10% (that is, for each price, demand is now 10% greater than it was before the price increase). Determine the change in equilibrium quantity.
A.)increases 8.2%
B.)increases 10%
C.)increases 2.44%
D.)increases 5.48%
2.)The custom T-shirt printing business has many competitors, so
that the perfect competition model may be considered a good approximation. Currently the market demand curve is given byQ= 120- 1.5p, whereas the market supply is given byQ=-20+ 2p.
Assuming the original demand curve, now suppose there is an increase in the cost of blank T-shirts, an essential input into the business of selling custom T-shirts. Specically, for each unit by each supplier, the production cost goes up by 10%. Determine the new supply curve.
A.)Q=-22+2p
B.)Q=-20+1.82p
C.)Q=-18+2.2p
D.)Q =-22+2.2p
The custom T-shirt printing business has many competitors, so
that the perfect competition model may be considered a good approximation. Currently the market demand curve is given byQ= 120- 1.5p, whereas the market supply is given byQ=-20+ 2p.
Assuming the original demand curve, now suppose there is an increase in the cost of blank T-shirts, an essential input into the business of selling custom T-shirts. Specically, for each unit by each supplier, the production cost goes up by 10%. Determine the change in equilibrium price.
A.) increases by 5.42%
B.) increases by 10%
C.) increases by 8.22%
D.)increases by 4.8%
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