b. The equilibrium price of printers saw a large decrease in the past year, however the equilibrium quantity remained unchanged. Three individuals provided an explanation for the situation. Which explanation(s) could be correct? Explain. • Alex: Demand increased, but supply was totally inelastic. • Lance: Supply increased, but so did demand. • Ricardo: Supply decreased, but demand was totally inelastic
b. The
the
explanation for the situation. Which explanation(s) could be correct? Explain.
• Alex:
• Lance: Supply increased, but so did demand.
• Ricardo: Supply decreased, but demand was totally
C.The demand for pancakes is given by Qd = 40 – 5P and the supply is given by
Qs = 10P – 20, where P = price What is the equilibrium price and equilibrium
quantity?
i. The price for iPhones in Barbados has increased significantly. Demand for the
cellular device has also increased. This is contrary to the
you agree or disagree? Explain your answer.
ii. Identify the flaw in this analysis: “If more Jamaicans become vegetarians, the
demand for beef will fall. The decrease in the demand for beef will cause the
price of beef to fall. The lower price, however, will then increase the demand.
In the new equilibrium, Jamaicans might end up consuming more beef than
they did initially.”
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