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7 . Determinants of supply
2 . Individual and market demand Suppose that Van and Amy are the only consumers of pizza slices in a particular market. The following table shows their annual demand schedules: Price Van's Quantity Demanded Amy's Quantity Demanded (Dollars per slice) (Slices) (Slices) 40 80 30 60 AWN 20 40 10 20 10 On the following graph, plot Van's demand for pizza slices using the green points (triangle symbol). Next, plot Amy's demand for pizza slices using the purple points (diamond symbol). Finally, plot the market demand for pizza slices using the blue points (circle symbol). Van's Demand Amy's Demand O PRICE (Dollars per slice) Market Demand 0 20 40 60 80 100 120 QUANTITY (Slices)6 . Individual and market supply Suppose that Kenji and Lucia are the only suppliers of pizza slices in a particular market. The following table shows their weekly supply schedules: Price Kenji's Quantity Supplied Lucia's Quantity Supplied ( Dollars per slice) (Slices) (Slices) 1 4 A W N 10 CO 11 On the following graph, plot Kenji's supply of pizza slices using the green points (triangle symbol). Next, plot Lucia's supply of pizza slices using the purple points (diamond symbol). Finally, plot the market supply of pizza slices using the orange points (square symbol). ? Kenji's Supply Lucia's Supply PRICE (Dollars per slice) Market Supply 12 16 20 24 QUANTITY (Slices)7 . Determinants of supply The following graph shows the supply curve for sedans in an imaginary market. Assume that all sedans are identical and sell for the same price. Two factors that affect the supply of sedans are the technology-the speed with which auto-manufacturing robots can fasten bolts, or "robot speed"-and the wage rate that auto manufacturers pay their employees. Initially, the graph shows the supply curve when robots can fasten 1,000 bolts per hour and autoworkers earn $30 per hour. Use the graph input tool to help you answer the following questions. You will not be scored on any changes you make to this graph. Note: Once you enter a value in a white field, the graph and any corresponding amounts in the grey field will change accordingly. Graph Input Tool (?) Market for Sedans Price of a Sedan 18 (Thousands of dollars) Supply Quantity Supplied 135 Sedans per month G 8 8 8 8 8 6 8 PRICE ( Thousands of dollars) Supply Shifters Robot Speed (Bolts per hour) 1000 Autoworker Wage 30 (Dollars per hour) 100 200 300 400 500 600 700 800 900 QUANTITY (Sedans per month) supply Suppose that the price of sedans in the previous graph ingtapfts fm $18,000 to $23,000 per car. This would cause thquantity suppiechof sedans to increase, which is reflected on the graph by movement along the supply curve. safer suppose hopedaginst say gent increases the speed with which robots can attach bolts to cars from 1,000 bolt away $9150 engltantralong hour. Assuming that the wage rate remains the same, this would cause = _rightward movement albriefly RI Fai shiFFayre the less expensive to build technological improvement makes cars more expensive to build leftward shift to
