Question
Suppose that the market for video games is competitive with the following demand function: Qd = 130 - 4 p + 2 Y + 3
Suppose that the market for video games is competitive with the following demand function:
Qd= 130 - 4p+ 2Y+ 3pm- 2pc, whereQdis the quantity demanded,pis the market price,Y
is the monthly budget that an average consumer has available for entertainment,pmis the average price of a movie, andpcis the price of a controller that is required to play these games.
a. Given thatY= $100,pm= $30, andpc= $30, calculate quantity demanded
forp= $10 top= $80 in $5 increments. Draw the demand curve.
b. Now,Yincreases to $120. Recalculate the demand schedule in part a. Draw the new demand curve in the same diagram.
c. LetY= $100 andpc= $30 again, but letpmincrease to $40. Recalculate the demand schedulein part a. Drawthe graph of the new demand curve.
d. LetY= $100,pm= $30, andpcincreases to $40. Recalculate the demand schedule in part a and draw the new demand curve.
clear writing please.
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