EBK INTERMEDIATE MICROECONOMICS AND ITS
12th Edition
ISBN: 9781305176386
Author: Snyder
Publisher: YUZU
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Question
Chapter 1, Problem 1.1P
(a)
To determine
Graphical representation of
(a)
Expert Solution
Explanation of Solution
The figure (1) below represents the graphical representation of given demand and supply curves. Here, X- axis measures the quantity (Q) and Y-axis measures price (P).
The downward sloping curve is demand curve (DD) and the upward sloping curve is supply curve (SS).
(b)
To determine
Algebraic equation of supply and demand curves.
(b)
Expert Solution
Explanation of Solution
As shown in figure (1) above, the given points lie along two straight lines.
Use following point slope formula to calculate algebraic equation:
To calculate algebraic equation of demand curve, plug (700,1) and (600,2) in (1).
To calculate algebraic equation of supply curve, plug (100,1) and (300,2) in (1).
Thus, equations of demand (QD) and supply (QS) curves are as follows:
(c)
To determine
Excess demand of the good if the market price is zero.
(c)
Expert Solution
Explanation of Solution
Excess demand refers to a situation where market demand is more than market supply at the given market price. It can be calculated by subtracting market demand from market supply.
(d)
To determine
(d)
Expert Solution
Explanation of Solution
Excess supply refers to a situation where market supply is more than market demand at the given market price. It can be calculated by subtracting market supply from market demand.
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Students have asked these similar questions
Suppose the annual demand for gasoline as motor fuel in the US can be represented by the demand curve: Qd=125 - 10*P, where Qd is the quantity measured in billions of gallons, P is the price in dollars per gallon, and the supply curve is: Qs=-100 + 40*P .
A) First, solve each equation for P, so that you can represent the inverse demand and the inverse supply on a graph with P on the vertical axis
B) Now, draw the supply-demand graph, with P on the vertical axis.
C) What is the equilibrium quantity of gasoline, in billions of gallons per year? The equilibrium quantity is
D) What is the equilibrium price of gasoline?
E) What is the amount of consumer surplus (CS), in billions of dollars, at the equilibrium price?
F) What is the amount of producer surplus (PS), in billions of dollars, at the equilibrium price
G) What is the total surplus (TS)?
The following table shows the annual demand and supply in the market for ice cream in Houston.
Price
Quantity Demanded
Quantity Supplied
(Dollars per gallon of ice cream)
(Gallons of ice cream)
(Gallons of ice cream)
4
2,000
200
8
1,600
600
12
1,200
800
16
800
1,200
20
400
1,800
On the following graph, plot the demand for ice cream using the blue point (circle symbol). Next, plot the supply of ice cream using the orange point (square symbol). Finally, use the black point (plus symbol) to indicate the equilibrium price and quantity in the market for ice cream.
The demand for coffee is given by the following equation, where QD�� stands for the quantity demanded and P stands for price.
QD=100−4PQD= 100- 4P
The supply of coffee is given by the following equation, where QS�� stands for the quantity supplied and P stands for price.
QS=-10+2PQS= -10+ 2P
For parts a-d, consider a graph of the demand and supply curves with price on the vertical axis and quantity on the horizontal axis.
What is the slope of demand?
Slope =
At what price is quantity demanded equal to zero (this is, graphically, the vertical intercept of Demand)?
P =
What is the slope of supply?
Slope =
At what price is quantity supplied equal to zero (this is, graphically, the vertical intercept of Supply)?
P =
Chapter 1 Solutions
EBK INTERMEDIATE MICROECONOMICS AND ITS
Ch. 1.2 - Prob. 1MQCh. 1.2 - Prob. 2MQCh. 1.3 - Prob. 1TTACh. 1.3 - Prob. 2TTACh. 1.4 - Prob. 1TTACh. 1.4 - Prob. 2TTACh. 1.4 - Prob. 1MQCh. 1.4 - Prob. 2MQCh. 1.4 - Prob. 1.1MQCh. 1.4 - Prob. 1.2MQ
Ch. 1.5 - Prob. 1TTACh. 1.5 - Prob. 2TTACh. 1 - Prob. 1RQCh. 1 - Prob. 2RQCh. 1 - Prob. 3RQCh. 1 - Prob. 4RQCh. 1 - Prob. 5RQCh. 1 - Prob. 6RQCh. 1 - Prob. 7RQCh. 1 - Prob. 8RQCh. 1 - Prob. 9RQCh. 1 - Prob. 10RQCh. 1 - Prob. 1.1PCh. 1 - Prob. 1.2PCh. 1 - Prob. 1.3PCh. 1 - Prob. 1.4PCh. 1 - Prob. 1.5PCh. 1 - Prob. 1.6PCh. 1 - Prob. 1.7PCh. 1 - Prob. 1.8PCh. 1 - Prob. 1.9PCh. 1 - Prob. 1.10P
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