Please answer the following. Please see attached document.
Answer the following questions in the text box provided: 1. For each of the following, indicate the impact on the equilibrium price and the equilibrium quantity. a. An increase in supply b. An increase in demand c. Adecrease in supply d. Adecrease in demand 2. Determine whether each of the following items would cause an increase in the supply of wood tables. a. A decrease in the price of the wood used to make the tables b. An increase in the price of the tables c. Adecrease in the number ofrms making wood tables d. An increase in the price of metal and glass tables 3. A monthly supply schedule of men's suits shows that at a price of $600, 20 suits will be supplied but at a price of $1,400, 75 suits will be supplied. Explain this occurrence given the basic law of supply. 4. During the summer of 2003, gas prices increased dramatically, with one city seeing a 60-cent increase in the average price of regular unleaded. a. In terms of the 'income' effect (pg. 87), what impact did the higher gas prices have on general consumer spending? b. In terms of the substitution effect (pg. 86), what goods or services might have become more or less popular as a result of the higher gas prices? 5. If the price of popcorn increases at a move theater, what do you expect to happen to the equilibrium price and equilibrium quantity of soft drinks sold in the same theater (complements)? 6. A college is selling T-shirts to support its college football team. If there is increased popularity of the teams depicted on the Tshirts, will this cause a change in demand or simply a change in the quantity demanded in the market for college T-shirts? Explain and indicate the direction of the change. 7. Assume the same as in #6 above. How would a lower price on baseball caps for the exact same teams as the T- shirts effect the quantity demanded of the T-shirts? Explain and indicate the direction of change. u.... ..... "nu..- m... .1._.........., \"nun\"u...\" u. \"n. . gnu...\" _..'...'...... ....... ................. m... .....u....._... v. "He\"o... 8. Floods wiped out the banana crop in Central America. From this disaster, what can you expect to happen to a. The equilibrium price of bananas b. The equilibrium quantity of bananas 9. Assume that the price of microprocessors has decreased. Explain why there is the shift in the supply curve for COMPUTERS as seen in the chart below: P Q .0. Over the past ten years, the price of personal computers has decreased signicantly. However, at the same time the quality of personal computers has improved dramatically which would tend to increase the demand for these computers. How can we reconcile the increased demand with the lower price? What other events may have taken place that lower the price of computers
