6:34 Question 1. Graphical Analysis Suppose soft wood lumber and plastic wood are substitutes in manufacturing furniture. During the Covid-19 pandemics, demand for new homes and a surge in renovations and DIY caused lumber prices skyrocketed to historic levels. How the high lumber price would affect quantity demanded for plastic wood? Try to use the graphical approach (via supply-demand diagrams) to show your answer. Edit Copy Link > 2 Question 2. Demand Function and Demand Table A data company, Cloud storage, provides low-cost data storage and file-sharing services based on yearly subscriptions. A study of the company found that their yearly subscriptions (quantity demanded or Q) can be estimated as a function of monthly prices (P) as the demand table below shows. Table 1. Potential Subscriptions and Prices for Cube Dash Price (P) $ 20.00/year $18.00/year $ 16.00/year $ 14.00/year Subscriptions (Q) Price (P) 11 million 12 million $12.00/year $10.00/year $ 8.00/year $6.00/year Subscriptions (Q) Note: Demand function is a linear relation of Q to P. Also, you do not need worry about the unit of price and subscriptions. Just use the numbers given for deriving the demand function. (a) Given the information provided, try to figure out the demand function for Cloud storage. (b) Finish the demand table above with filling the empty spots of Subscriptions (Q). Plot the demand curve with the data obtained from Table 1. Note: You may plot the demand via spreadsheet or other software. Or you may draw the demand curve on paper and take a picture of it. Then, you can add the picture in this document or upload of separate picture via the link on Canvas. Question 3. Supply, Demand and Equilibrium (Job Market) In the United States, demand for long-haul truck drivers has noticeably increased over recent years. According to the Bureau of Labor Statistics (BLS), the job for truck drivers is expected to increase at 6 percent per year up to 2030. Suppose the BLS economists estimated the supply curve for long-haul truck drivers as a function of quantity supplied (Qs) of truckers and nominal wage (W), as Q1 +0.02 * W in 2023. And the demand for truckers is a function of quantity demanded (Qa) and W, as Q = 2.65 - 0.01 * W. Here we take Q as the number of jobs (million) and W as the nominal wage rate (as $1000 or K). Tip: you do not need worry about the units of Q and W in this question. You just need to plug in the values of Q and W from the market equilibrium solutions derived. (a) Given the information as above, how much is the market equilibrium wage (as $1000 or K) for tuckers in 2023? And how many jobs available for truck driver in 2023? (b) If the demand for truckers increased to Q = 2.89 -0.01 * W, then how much will be the new equilibrium wage (W) and the number of jobs (Q)? References: % Heavy and Tractor-trailer Truck Drivers https://www.bls.gov/ooh/transportation-and-material-moving/heavy-and-tractor-trailer-truck- drivers.htm 4 ||