7. The Greensboro Grasshoppers are a Minor League Baseball team based in Greensboro, North Carolina. Suppose that Grasshoppers jerseys are bought and sold in a competitive market. One year, the Grasshoppers win the conference championship, which increases dramatically interest in team merchandise. Specifically, suppose that at any price level, the number of people wanting to buy a Grasshoppers jersey increases by 1000. In the new short-run equilibrium, what will happen to the price of a Grasshoppers jersey and the number of Grasshoppers jerseys sold? (You can assume that supply and demand are neither perfectly elastic nor perfectly inelastic.) a. Quantity will go up by exactly 1000; Price will go up b. Quantity will go up by more than 1000; Price will go up c. Quantity will go up by less than 1000; Price will go up d. Quantity will go up by more than 1000; Price will go down e. Quantity will go up by less than 1000; Price will go down

9. Petflicks is an online streaming service that only streams shows and movies about pets. Demand for this kind of content is surprisingly robust, and Petflicks estimates that each of their individual customers' demand for watching content can be described by the equation P = 0.90 - 0.02Q or Q = 45 - 50P, where P is the price each customer would be willing to pay for an hour of content and Q is the number of hours of content each customer demands. If Petflicks' marginal cost for every hour streamed is $0.10, what pricing plan will maximize Petflicks' profits? a. Per-hour price = $0.50, no monthly subscription fee b. Per-hour price = $0.50, monthly subscription fee of $4 c. Per-hour price = $0.50, monthly subscription fee of $16 d. Per-hour price = $0.10, monthly subscription fee of $16 e. Per-hour price = $0.10, monthly subscription fee of $20.25