1)Consider the following demand/supply schedules for Whey Protein Powder, used to build muscle in weight training...

Price (P)................Quantity demanded..................Quantity Supplied................Surplus/Shortage

($/Pound)(Pounds/month)(Pounds/month)

40.00.................................0.............................................. 600

35.00...............................100.............................................500

30.00............................... 200............................................400

25.00................................300............................................300

20.00.................................400...........................................200

15.00..................................500...........................................100

10.00..................................600..............................................0

Questions:

(a)Draw a diagram of the market for Whey protein powder, showing the demand and supply curves.

(b)What is the equilibrium price and quantity of Whey powder exchanged in the market?

(c)Suppose that the local health store decides to charge $20 per pound for Whey powder? Is there a surplus or shortage at this price? Explain. How would the market price adjust as a result?

(d)Explain how each of the following changes would affect either the demand side or supply side of Whey protein powder. Draw a separate diagram for each case and show the effect on equilibrium price and quantity...

(i)There is an increase in income (all else equal)

(ii)The price of whey, used to produce the protein powder, increases (all else equal)

(iii)Gyms reopen after Covid-19 is under control (all else equal)

(iv)There's a decrease in the price of Soy protein powder, a substitute in consumption for Whey protein powder (all else equal)

(v)There's an increase in the price of whey protein powder (all else equal)

2)Distinguish between a change in quantity demanded and a change in demand. Provide diagrams and a written explanation...

3)An economist notices that the equilibrium price of apples has decreased and more apples are exchanged in the market. Did a shift of demand or supply cause this change? Use a diagram to explain...