Use the hypothetical market for rechargeable batteriesillustrated in the accompanying graph to answer the10questions that follow.Supply (2)a. Use the interactive graph to illustrate the impact of anincrease in consumer income. Assume rechargeablebatteries are a normal good.Supply (1)вb. Use the midpoint formula to calculate the price elasticityof supply for Supply(1) between the old and new price.Round to two places after the decimal.3000Units1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000 10,000c. Use the midpoint formula to calculate the price elasticityQuantity of batteriesofPrice per battery c. Use the midpoint formula to calculate the price elasticityofsupply for Supply(2) between the old and new price. Enteryour answer below. Round to two places after the decimal.2000Units

Question
Asked Dec 13, 2019
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Use the hypothetical market for rechargeable batteries
illustrated in the accompanying graph to answer the
10
questions that follow.
Supply (2)
a. Use the interactive graph to illustrate the impact of an
increase in consumer income. Assume rechargeable
batteries are a normal good.
Supply (1)
в
b. Use the midpoint formula to calculate the price elasticity
of supply for Supply(1) between the old and new price.
Round to two places after the decimal.
3000
Units
1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000 10,000
c. Use the midpoint formula to calculate the price elasticity
Quantity of batteries
of
Price per battery
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Use the hypothetical market for rechargeable batteries illustrated in the accompanying graph to answer the 10 questions that follow. Supply (2) a. Use the interactive graph to illustrate the impact of an increase in consumer income. Assume rechargeable batteries are a normal good. Supply (1) в b. Use the midpoint formula to calculate the price elasticity of supply for Supply(1) between the old and new price. Round to two places after the decimal. 3000 Units 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000 10,000 c. Use the midpoint formula to calculate the price elasticity Quantity of batteries of Price per battery

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c. Use the midpoint formula to calculate the price elasticity
of
supply for Supply(2) between the old and new price. Enter
your answer below. Round to two places after the decimal.
2000
Units
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c. Use the midpoint formula to calculate the price elasticity of supply for Supply(2) between the old and new price. Enter your answer below. Round to two places after the decimal. 2000 Units

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Expert Answer

Step 1

a)

The increase in income of the consumer increases the quantity demanded for goods. Thus, it shifts the demand curve to rightward from D1 to D2. “E” is the initial equilibrium point in the market. The shift in demand curve leads to the movement of equilibrium point from “E” to “A” on supply curve (2) and from “E” to “B” on supply curve (1). Figure is shown below.

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10 D2 Supply (2) D1 Supply (1) в 1,000 2,000 3,000 4,000 5,000 6.000 7,000 8,000 9,000 10,000 Quantity of batteries Price per battery 3.

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Step 2
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2) 2-Q1 Q2 +Q1 ED P2-P P, +P, 8,000 – 5,000 8, 000 +5,000 2 6-5 6+5 3,000 6,500 5.5 0.461538 0.181818 = 2.5384 Price elasti city of supply (1) is 2.5384

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