Consider the market for home improvements. If the cost of wood increases sharply, then the (demand for/ supply of) home improvements will (increase / decrease). This is depicted in diagram (A, B, C, D). The effect on equilibrium price will be (an increase / a decrease) and the effect on equilibrium quantity will be (an increase / a decrease). (A) (C) S S₁ D₂ D₁ S2 0 (B) (D) S D₁ D₂ S2 S₁ D Q
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- Earlier this year, 2021, the price of chicken meat rose unexpectedly reached to 250/ kilo at peak from the previous price of 170/ kilo. This 68% increase of price per kilo was primarily caused by excess demand for chicken meat. This is the result of the decrease in consumption for pork meat due to the threat of African Swine Flu (ASF). However, even though consumer shifted preferences, the increase in the price of chicken was perceived to be too high for the budget of consumers. Therefore, sellers realized decrease in their daily aggregate sales from 1,000 kilos to 700 kilos. 1. Illustrate the change in the market equilibrium through a graph. 2. What presumably happened to the total revenues of the sellers during the price hike period? a.) Compute the price elasticity of demand b.) Derive the total revenue before the hike (TR1), and after the hike (TR2).Earlier this year, 2021, the price of chicken meat rose unexpectedly reached to 250/ kilo at peak from the previous price of 170/ kilo. This 68% increase of price per kilo was primarily caused by excess demand for chicken meat. This is the result of the decrease in consumption for pork meat due to the threat of African Swine Flu (ASF). However, even though consumer shifted preferences, the increase in the price of chicken was perceived to be too high for the budget of consumers. Therefore, sellers realized decrease in their daily aggregate sales from 1,000 kilos to 700 kilos. Illustrate the change in the market equilibrium through a graph. What presumably happened to the total revenues of the sellers during the = price hike period? Compute the price elasticity of demand. Derive the total revenue before the hike (TR1), and after the hike (TR2).In the bread market, Maria buys different amounts of bread conditional on whether the price is $2, $5, or $7 a loaf. To generate Maria’s demand curve for bread, what other set of information do we need? Group of answer choices: whether her bread consumption goes up or down with price how much bread she buys in total how much bread she buys at each price point whether or not she switches to a substitute when the price is high
- Karen has perfect complement preferences over toothbrushes B and toothpaste P, with the associated utility function U(B,P) = min (3B, 2P). Suppose the price of a toothbrush is $6, the price of toothpaste is $4 a tube, and she has $72 to buy her entire year's supply of toothbrushes and toothpaste. How many toothbrushes and tubes of toothpaste will she buy?Given an individual’s current consumption patterns, we know that the person is consuming in such a manner that he is maximizing his satisfaction. Given a decrease in the price of one of the goods he normally purchases, what will happen to the consumer’s total satisfaction and to the marginal utilities connected with the consumption of this particular good. a) His overall satisfaction will increase, but his satisfaction from the last unit consumed of the good with a decreased price will decrease. b) His overall satisfaction will decrease and his satisfaction from the last unit consumed of the good with a decreased price will decrease. c) His overall satisfaction will increase and his satisfaction from the last unit consumed of the good with a decreased price will increase. d) His overall satisfaction will decrease and his satisfaction from the last unit consumed of the good with a decreased price will increase. e) We cannot tell about the changes in his total utility or his marginal…For the Price-Consumption Line & Demand Curve: (kindly place Good A on the X-axis & Good B on the Y-axis) If the consumer's tastes are given by the Indifference curves schedule and Pa = P1.00, Pb= P1.00 and original budget = P10.00, what happens if budget remains the same but the price of Good A decreases to P0.50 To do: Create the new budget schedule. Plot the 2 budget lines with the 3 indifference curves together and determine the tangency points or LCPC and create the Price-Consumption Line. Create the Demand Curve for Good A.
- define the concept of consumer's equilibrium, present it into figure and justify the statement by deriving and intuitively explaining the mathematical condition for the equilibrium.You were promoted as the manager of a new Clean-Well Sanitary Store that sell cleaning andsanitation products wholesale. You recently read in an article that there the price of vitamins isexpected to increase by 20 percent. How will this affect your store’s sales of sanitationproducts?Which of the ff. is correct with regards to the demand curve? A. If the price of the good increases, the demand curve for the good will shift to the left B. If the price of the good increases, the consumers have the incentive to look for substitutes, thus, the quantity demanded and its price are inversely related C. Income of the consumers is written on the vertical axis D. Varying preferences of the consumers is reflected in the demand curve and is written on the horizontal axis
- If organic virgin coconut oil (VCO) has been proven to enhance your immune system against corona virus, the price VCO will increase because of a shift in supply and an unchanging demand curve.In the below figure, a consumer is initially in equilibrium at point C. The consumer’s income is $400, and the budget line through point C is given by $400 = $100X + $200Y. When the consumer is given a $100 gift certificate that is good only at store X, she moves to a new equilibrium at point D. Determine the prices of goods Xand Y.Price of X: $ Price of Y: $ b. How many units of product Ycould be purchased at point A?c. How many units of product X could be purchased at point E?d. How many units of product X could be purchased at point B?e. How many units of product X could be purchased at point F?f. Based on this consumer’s preferences, rank bundles A, B, C, and D in order from most preferred to least preferred. (Click to select) D, B, C, A D, C, A, B C, A, B, D A, B, C, D g. Is product X a normal or an inferior good? (Click to select) Normal InferiorA consumer is in equilibrium when Px = 7 and Py = 4, and he is consuming 40 units of good X and 80 units of good Y. If Py increases to Rs. 5, he moves to a new equilibrium where he consumes 50 units of good X. Beginning from the new equilibrium, if income increases by Rs 100 and the consumer decides to consume 65 units of good Y, what will be the shape of the ICC and the Engel curve? Calculate and explain. Also draw the demand curve for Y indicating the above scenario.