Assignment 2 is worth 4% of your final grade for this course and will be graded out of 22 marks. Read each question carefully. Be sure to answer ALL of the questions. 1. Data for the market for bottled water is shown in the following table. Price ($ Per Widget) Quantity Demanded Original Quantity Supplied New Quantity Supplied 1.00 300 60 1.50 270 90 2.00 240 120 2.50 210 150 3.00 180 180 3.50 150 210 4.00 120 240 1. Bottled water producers have adopted a new technology permitting quantity supplied to increase by 40%. Fill in the new quantity supplied in the last column. (2 marks) 2. State the equilibrium price and quantity before the adoption of the new technology. (2 marks) 3. State the equilibrium price and quantity after the adoption of the new technology. (2 marks) 2. The following table shows market data for toasters. Price ($ / Unit) Quantity Demanded Total Revenue ($) Price Elasticity of Demand 60 55 N 50 W 45 40 35 30 25 00 20 https://moodle.tru.ca/mod/assign/view.php?id=1724996 1/3 7/12/22, 10:31 AM ECON_1901_J02_202225: Assignment 2 (4%) 1. Fill in the total revenue column. (3.5 marks) 2. Calculate the price elasticity of demand for each price change (use the mid-point formula, round off final calculation to 2 decimals, and show all your work). (3.5 marks) 3. Write a sentence or two, describing the relationship between, price, total revenue and price elasticity of demand. (2 marks) 3. Answer the following: 1. If a 10 percent increase in the price of good A results in an increase of 5 percent in the quantity demanded of good B, then what can be concluded about the association between goods A and B? (1 mark) 2. Suppose the income elasticity of demand for good C is +3.00. Explain the effect of a 10% rise in income on the demand for good C. (1 mark) 3. Is good C a normal or inferior good? (1 mark) 4. Consider the global market for rice. A new technology is adopted for rice harvesting. At the same time, a rise in global household income results in a fall in the tastes and preferences for rice. Draw a graph for the global market for rice illustrating these events and explain, in words, the effect on the equilibrium price and quantity of rice. (for full marks, ensure your graph is properly labelled). (4 marks)