Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

I need help with micoeconomic Q1: Complete the table. Indicate whether the demand for each of the products is elastic or inelastic and give one

I need help with micoeconomic

image text in transcribed
Q1: Complete the table. Indicate whether the demand for each of the products is elastic or inelastic and give one (and only one) reason to support your answer. Product Restaurant meals Fresh vegetables Salt Beer Fresh salmon Medical prescriptions Diamonds Elastic or Inelastic Demand? Reason Q2: Figure 4-5 on page 82 of the course textbook shows a market with two demand curves that intersect each other and the initial supply curve (S1) at point A. Suppose one of the demand curves represents buyers in City X and the other demand curve represents buyers in City Y. Further suppose that buyers in City X have a more elastic demand than buyers in City Y at the current equilibrium in the graph. a) Give and explain three distinct reasons why buyers in City X would have a more elastic demand than buyers in City Y. b) Which demand curve, the flatter one or the steeper one, represents buyers in City X? c) Suppose the supply of the product decreases and the supply curve shifts to the left to S 2. In which city does the equilibrium price change more? d) Suppose the supply of the product decreases and the supply curve shifts to the left to S2. In which city does the equilibrium quantity change more? e) Suppose instead that one demand curve represents buyers in the short run and the other demand curve represents the same buyers in the long run. Which demand curve, the flatter one or the steeper one, represents buyers in the short run

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Managerial Accounting

Authors: Ray Garrison, Eric Noreen, Peter Brewer

15th edition

1259404781, 007802563X, 978-1259404788, 9780078025631, 978-0077522940

Students also viewed these Economics questions