econ 251 hw 3
What would happen to the price of orange juice if citrus greening wiped out the Florida orange crop? If citrus greening wipes out the Florida orange crop, the price of orange juice would _______.
rise
Demand and supply in the market for 9 volt batteries are given by the equations. Qd= −2P + 139 Qs= P−5 What is the marginal cost of producing the 5th battery?
$10
Demand and supply equations in the market for hand sanitizer are given below. Qd= 10−1/2P Qs= 2P What is the marginal benefit of the 4th bottle of hand sanitizer?
$12
What is the marginal cost of the 4th bottle of hand sanitizer
$2
Demand and supply in the market for insulated cups are given by the following equations. Qd= 1500−20P Qs= 30P−300 What is the marginal cost producing the 300th insulated cups?
$20
The demand and supply equations in the avocado market are given below. (Qd is the quantity demanded, Qs is the quantity supplied, and P is the price.) Qd=20−2P Qs=8P The equilibrium price of an avocado is _________, and the equilibrium quantity of avocadoes is ________.
$2; 16
Use the following demand and supply functions for the market of long sleeve shirts: Qd = 40−(1/4)P Qs = (1/2)P−5 What is the marginal cost of producing the 10th long sleeve shirt?
$30
The two equations set up the supply and demand for DVD players. Supply: Qs = 10P−400 Demand: Qd = 2,000−20P What is the marginal cost of the 100th DVD player?
$50
At what point is demand unit elastic in the market for insulated cups?
(750, $37.50)
At which of the following points is the price elasticity of demand strictly greater than one?
15, $100
What is the equilibrium (Q*, P*) in the market for long sleeve shirts?
25, $60
At which of the following points in the market for avocados is demand elastic
6, $7
At what point does the market for insulated cups reach equilibrium
780, $36
The table gives the demand and supply schedules for batteries. Suppose that demand increases by 50 batteries a day and supply decreases by 100 batteries a day. What is the new equilibrium price of a battery and what is the new equilibrium quantity of batteries?
The new equilibrium price is $2 per battery. The new equilibrium quantity is 650 batteries per day.
On Mother's Day, the demand for roses increases by 160 roses. Rose sellers offer for sale the normal quantity plus the roses held back last weekend. What is the price of a rose on Mother's Day?
The price of a rose on Mother's Day is $9
Rose sellers know that Mother's Day is next weekend and they expect the price to be higher next weekend, so this week they withhold 60 roses from the market. What is the price of a rose this weekend?
The price of a rose this weekend is $8
Would you classify frozen concentrated orange juice as a normal good or an inferior good? Why? Frozen concentrated orange juice is _______.
a normal good if demand increases when income increases
The graph illustrates the market for tea. The market equilibrium is at point A. After one or more changes, the market equilibrium moves to point B. You predict that the market for tea was most likely influenced by _______.
a rise in household income and a rise in the number of plantations
the figure shows the demand for pens. Calculate the elasticity of demand when the price rises from $2 to $4 a pen. Over what price range is the demand for pens elastic? The elasticity of demand when the price rises from $2 to $4 a pen is 0.33 The demand for pens is elastic at ______
all prices greater than $6 a pen
If demand and supply change in the same direction, we _____ the direction of change of the equilibrium quantity and we _____ the direction of change of the equilibrium price.
can predict; cannot predict
Rain spoils the strawberry crop, the price of strawberries rises from $6 to $8 a box, and the quantity demanded decreases from 600 to 200 boxes a week. Calculate the price elasticity of demand over this price range. Describe the demand for strawberries. Over the price range of $6 to $8, the price elasticity of demand is 3.50 Over this price range, the demand for strawberries is ______.
elastic
a decrease in the price of soap, a complement in production of palm oil, will ______ the equilibrium price of palm oil and ______ the equilibrium quantity of palm oil.
increase; decrease
The shorter the time that has elapsed since a price change, the more _______.
inelastic is demand
Over what range of prices does a shortage arise? What happens to the price when there is a shortage? The graph shows the demand curve and the supply curve in the market for bicycles. Draw a horizontal line at a price at which there is a shortage of bicycles. Label it Shortage. When a shortage arises, the price ______ to its equilibrium, which _______.
rises; decreases the quantity demanded and increases the quantity supplied
The graph shows the demand for and supply of potato chips. Draw a curve that shows the effect of a new dip that increases the quantity of potato chips that people want to buy by 30 million bags per week at each price. Label the curve 1. Draw a curve that shows the effect of a virus that destroys potato crops and decreases the quantity of potato chips produced by 40 million bags a week at each price. Label the curve 2. Draw a point at the new equilibrium price and quantity following both events When the increase in demand is greater than the decrease in supply, the equilibrium price _____ and the equilibrium quantity _____.
rises; increases;
A decrease in the demand for sports cars together with an increase in the supply of sports cars brings a______ of sports cars at the original price and a______ in their price.
surplus; fall
What is the market equilibrium? At the market equilibrium, the price of a rose is ______ and _____ roses per week are bought and sold.
$7; 100
What is equilibrium in the market for batteries?
(43, $48)
If the demand for batteries rises, which of the following could represent the new equilibrium?
(47, $52)
At what point in the market for hand sanitizer is demand unit elastic?
(5, $10)
When the price of DVD players rises from $70 to 74, the price elasticity of demand is _______, implying that demand is __________ in this price range.
18/7 = 2.57; elastic
The equilibrium quantity of hand sanitizer is ___________, and the equilibrium price is ___________.
8, $4
The fewer the substitutes for a good or service, the more ______ is the demand for it. The smaller the proportion of income spent on a good, the more ______ is the demand for it.
inelastic; inelastic
When the increase in demand is less than the decrease in supply, the equilibrium price _____ and the equilibrium quantity _____.
rises; decreases
When the increase in demand equals the decrease in supply, the equilibrium price _____ and the equilibrium quantity _____.
rises; remains unchanged
1. If the price of a rose is $6, describe the situation in the rose market. Explain how the price adjusts. If the price of a rose is $6, there is a _____ of roses and the price of a rose_____.
shortage; rises
If the price of a rose is $9, describe the situation in the rose market. Explain how the price adjusts. If the price of a rose is $9, there is a _____ of roses and the price of a rose _____.
surplus; falls