3. Over the past few years in the market for solar panels, we have seen lower prices and more panels being sold. a) Draw a supply-demand diagram for the market, showing the initial equilibrium price and quantity (indicated with P,*, Q* on the P and Q axes respectively.) b) What one curve (supply or demand) must have shifted, and in what direction, to cause both a decrease in price and an increase in quantity sold in the solar panel market? Illustrate this on your graph in part (a) (Show the new curve and the resulting new equilibrium price and quantity (indicated with P,*, Q,*.) c) Briefly describe two different events that might cause the shift you described above in the market for solar panels.
3. Over the past few years in the market for solar panels, we have seen lower prices and more panels being sold. a) Draw a supply-demand diagram for the market, showing the initial equilibrium price and quantity (indicated with P,*, Q* on the P and Q axes respectively.) b) What one curve (supply or demand) must have shifted, and in what direction, to cause both a decrease in price and an increase in quantity sold in the solar panel market? Illustrate this on your graph in part (a) (Show the new curve and the resulting new equilibrium price and quantity (indicated with P,*, Q,*.) c) Briefly describe two different events that might cause the shift you described above in the market for solar panels.
Micro Economics For Today
10th Edition
ISBN:9781337613064
Author:Tucker, Irvin B.
Publisher:Tucker, Irvin B.
Chapter4: Markets In Action
Section: Chapter Questions
Problem 14SQ
Related questions
Question
Only 3.
Transcribed Image Text:8:37
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d) Explain what the supply and demand model indicates
will happen to equilibrium price and
quantity in this market due to the event you described.
Does this make sense based on what you
know from living in markets your whole life?
1. Market: Commercial office space (Q is square footage of
rental office space, P is $ per sq footage rent.)
Event: The extensive work-from-home necessitated by
COVID-19 makes businesses realize that
many employees can be just as productive from
home and they don't need to require people
to be in the office always, or even often.
2. Market: Automobiles
Event:
Increase in steel tariffs, as we saw in 2018, raises
the price of steel used to make cars.
3. Over the past few years in the market for solar panels, we
have seen lower prices and more
panels being sold.
a) Draw a supply-demand diagram for the market, showing
the initial equilibrium price and
quantity (indicated with P,*, Q* on the P and Q axes
respectively.)
b) What one curve (supply or demand) must have shifted,
and in what direction, to cause both
a decrease in price and an increase in quantity sold in
the solar panel market? Illustrate this
on your graph in part (a) (Show the new curve and the
resulting new equilibrium price and
quantity (indicated with P,*, Q,*.)
c) Briefly describe two different events that might cause
the shift you described above in the
market for solar panels.
4. In market for gasoline, suppose the following two events
happen simultaneously
1) Continued ransomware attacks on major gas pipelines
or refineries, like the one last summer
(https://www.washingtonpost.com/business/2021/05/08/cyber-
attack-colonial-pipeline/)
regularly interrupt the refining of oil and the
distribution of gasoline.
2) Several mujor uuwm
Come Outwith neW.
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