EBK PRINCIPLES OF MICROECONOMICS (SECON
2nd Edition
ISBN: 9780393616149
Author: Mateer
Publisher: W.W.NORTON+CO. (CC)
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Chapter 4, Problem 12SP
To determine
Determine the
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College tuition has been rising at a faster rate than average prices for decades. Assess how the characteristics of the market for higher education have affected tuition. Your essay should address all of the following:
Do you believe that the price elasticity of demand for college is elastic or inelastic? Discuss the factors that support your position.
Do you believe that the price elasticity of supply for college is elastic or inelastic? Discuss the factors that support your position.
What has happened to the demand for college over the last 20 years? Explain what resulted in this change. Does your previous answer regarding the price elasticity of supply help explain why tuition has risen so quickly? Explain your reasoning.
Per-student, real government funding of higher education is lower now than it was in 2000. How would this reduced funding affect the supply of higher education? Explain. Does your previous answer regarding the price elasticity of demand help explain why tuition…
Beginning with the Fall 2018 semester, three North Carolina universities (UNC Pembroke, Western Carolina University, and Elizabeth City State University) reduced their tuition. After the Fall semester had begun, each of these universities announced that they had experienced a large increase in enrollment.
Explain what these facts tell us about the price elasticity of demand for education at these universities.
Use your answer to part a. of this question to explain whether reducing tuition would lead to an increase, a decrease, or no change in the amount of revenue received by the universities.
HOW DO YOU RESPOND TO PRICE ELASTICITY?
People have unlimited needs and wants for their personal satisfaction and because of that the prices
of products easily get changed.
Everyone is affected with the new normal in the market. The prices of products have become very
expensive since the outbreak of the pandemic, not only in our locality, but in the whole world.
If your income or the income of your family is not enough to purchase the basic commodities
needed by your family, what goods would you buy, instead?
What economic or marketing strategies would you apply? How would you respond to the price
changes of these commodities?
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- Who would pay a tax imposed on the supplier when the price elasticity of supply is inelastic and the price elasticity of demand is elastic?arrow_forwardWhat effect does the availability of many substitute have on the elasticity of demand for a goodarrow_forwardIf a price increase from $5 to $7 causes quantity demanded to fall from 150 to 100, what is the absolute value of the own price elasticity at a price of $7?arrow_forward
- if the price elasticity of demand for a product is 2.5, then a price cut from $2.00 to $1.80 will:arrow_forwardIf the price elasticity of demand for restaurant meals is less than 1, will total spending on them rise or fall if the wage of waiters falls?arrow_forwardSuppose that the quantity demanded for an item was 20 units when its price was $5.00; then the quantity demanded decreased to 10 units when the price increased to $7.00. Calculate the price elasticity of demand?arrow_forward
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