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Question 1 The following table shows the market demand and supply for Gala apples in Red Deer. Price ($) Quantity Demanded Quantity Supplied 0 250 90 220 100 190 110 AWN 160 120 130 130 5 100 140 6 70 150 a) What is the equilibrium price and quantity traded? b) Suppose that the supply increases by 80, what would be the new equilibrium price and quantity traded? c) After the increase in supply, what would be the surplus/shortage at a price of $3? Question 2 Consider the effects of each event outlined in the following table on the market for orange juice in Canada. Place a (1 ), (4 ) or (-) under the appropriate heading to indicate whether there will be an increase, decrease, or no change in demand (D), supply (S), equilibrium price (P) and quantity traded (Q). Assume orange juice is a normal good. DS PQ a) Medical research indicates that orange juice can cure baldness. b) There is a significant increase in the price of oranges. c) An increase in income taxes reduces the after-tax income of Canadians d) An improved method of juicing is introduced in the industry e) The price of apple juice increases dramatically Question 3 What effects will the following changes have on the price and quantity traded of computers? a) General population increases b) New and better technology for producing computers is introduced c) Income of the population increases d) Wage for computer workers increase