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11:42 Settings + . . . Assignment #2 This assignment relates to the following Course Learning Requirements: CLR2: Analyze how competitive markets allocate resources Objective

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11:42 Settings + . . . Assignment #2 This assignment relates to the following Course Learning Requirements: CLR2: Analyze how competitive markets allocate resources Objective of Assignment: The objective of this assignment is to measure your ability to construct and use the Demand / Supply model to illustrate market dynamics. Pre-Assignment Instructions: Complete up-to and including module four, including assigned readings and work. Assignment Tasks: 1) Demand and Supply Model a) Consider the streaming service industry, and the various competitors (platforms) within it. These platforms allow consumers to stream movies and television series to their desired devices (i.e. TVs, tablets, PC etc). A new streaming platform "Cyber Cinema" has done some research to create a demand schedule showing how many monthly subscriptions (the quantity demanded) the market (they and their competitors) can sell, at various price points. Page 1 of 3 ALGONQUIN COLLEGE | Online Streaming Service Demand Schedule Scenario Monthly Price per Subscription (in dollars) Subscriptions (in millions) A $12.00 120 million B $14.00 30 million C $16.00 60 million $18.00 50 million $20.00 45 million Plot the various scenarios (points) on a graph. Clearly label the axis Draw a GREEN line through the points to illustrate the trend in the demand. (2 points total b) Cyber Cinema has determined that due to the high costs of computer servers required to provide a streaming service, each platform is only willing to sell a certain number of monthly subscriptions depending on the price point the consumers are willing to accept. Streaming Service Supply Schedule Scenario Monthly Price per Subscription (in dollars) Subscriptions (in millions) 12 45 2 14 50 3 16 60 4 18 80 5 20 120 Page 2 of 3 ALGONQUIN COLLEGE | Online Plot the various scenarios (points) on the same graph as above. Draw a RED line through the points to illustrate the trend in the supply. (2 points total) c) Answer the following What is the equilibrium price? Label this point on the axis (2 points) Explain how the curves and price would change if a new technology emerged, lowering the cost of the servers? (2 points) Explain how the curves and price would change if Satellite and Television providers (substitute services to the streaming service providers) decreased their monthly subscription price? (2 points) Submission Procedures: Your assignment should be typed (Calibri or Ariel, 12-point font) and submitted as a digital document (e.g., Word, PDF). Clearly label each response (1(a), 1(b), etc.). For graphs, you may create it digitally, or hand draw and submit as a picture file or scan, please insure each is properly labelled and legible. Submit your completed assignment by [Deadline]

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