Supply and Demand and Equilibrium Price

Individual Assignment 1 1. Briefly point out the faulty reasoning in all(prenominal) of the chase situations a. You win a free, nontransferable ticket to a Sheryl line-shooting concert. Since the ticket is free and it will therefore damage you nothing to go, you resolve to go to the concert. b. You paid nonrefundable tuition of $3,000 to take a 15- work workweek course. Therefore, the opportunity cost of attending class each week is $3,000 divided by 15, or $200. c. You induct purchased 5 premium apples for $1. 99 a pound, but when you suck up home, you discover they are mushy.Since you paid top dollar for these apples, you decide you have to eat them. 2. Briefly explain why the following statements are either TRUE or FALSE a. Even though school entrance hall rooms are rationed by lottery, these rooms are dumb affected by economic forces. b. Because the U. S. postal service is a monopoly and intercourse sets postal outlays through legislation, market forces do not partic ula scrape cast tolls. c. New York City government auctions taxi medallions that give the right to manoeuvre passengers by taxi.Because the government controls the number of medallions, market forces do not determine their value. 3. Indicate whether each of the following statements describes an increase in demand, decrease in demand, change in amount of money demanded, increase in leave, decrease in supply, or change in quantity supplied in the given market. a. Store-brand dope prices are cut, reducing sales of Campbells soup. marketplace Campbells soup. b. cocoa bean prices hit an 18-month low following a bountiful harvest. Market coffee beans. c. A summer heat wave leads to higher prices for bottled water.Market bottled water. d. pass clothing discounts boost clothing sales. Market clothing. e. Apple introduces a tinier and more(prenominal) powerful iPod model. Market older iPod models. f. The cost of pesticides increases, leading to a rise in the price of soy beans. Ma rket soy beans. 4. Given the following data for individuals, draw the market demand curve and market supply curve for CDs. Assume that these are the only individuals in the entire market. legal injury is per CD. Price $8. 00 $8. 50 $9. 00 $9. 50 $10. 00 $10. 0 Quantity demanded in units per week Mark 3 3 1 0 0 0 Lynn 8 7 6 3 2 1 Jason 6 5 4 3 0 0 Erin 10 9 7 6 4 2 Quantity supplied in units per week Jeff 0 1 2 3 4 6 Beth 2 3 3 4 6 7 Chris 0 1 2 3 5 6 Abby 1 1 2 2 3 5 a. What would be the equilibrium price and quantity in this market? b. Which would there beexcess demand or excess supplyat a price of $8. 00? How much? What virtually at a price of $10. 00? c. If the price of a CD was ab initio set at $9. 00 but the price was allowed to adjust, would the price rise or fall? Explain your answer. 5.State the effect of the following events on equilibrium price and quantity of the market given. a. Beetle infestation decimates tobacco crop. Market cigars. b. The governing bod y for Petroleum Export Countries raises oil export quotas. Market petrol. c. Digital effigy albums become the rage among households while improved technology reduces the cost of producing digital cameras. Market digital cameras. c. Hurricanes in the Gulf coast cause gasoline supply disruptions while the summer travel season ends. Market gasoline. 6. The interpret below shows supply and demand curves for annual medical office visits. utilise this graph, answer the questions below. pic a.If the market were free from government regulation, what would be the equilibrium price and quantity? b. prefigure total expenditures on office visits with this equilibrium price and quantity. c. If the government subsidized office visits and required that all consumers were to pay $30 per visit no matter what the actual cost, how many visits would consumers demand? d. What retribution per visit would doctors require in order to supply that quantity of visits? e. Calculate total expenditures on office visits under the condition of this $30 co-payment. f. How do total expenditures with a co-payment of $30 compare to total expenditures without government interlocking? Provide a numerical answer.