Exploring Economics
8th Edition
ISBN: 9781544336329
Author: Robert L. Sexton
Publisher: SAGE Publications, Inc
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Question
Chapter 4, Problem 4P
To determine
The demand schedule for the market and the market demand curve.
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Students have asked these similar questions
The U.S. government administers two programs that affect the
market for cigarettes. Media campaigns and labeling requirements
are aimed at making the public aware of the health dangers of
cigarettes. At the same time, the Department of Agriculture
maintains price supports for tobacco. Under this program, the
supported price is above the market equilibrium price and the
government limits the amount of land that can be devoted to tobacco
production. Are these two programs at odds with the goal of
reducing cigarette consumption? As part of your answer, illustrate
graphically the effects of both policies on the market for cigarettes.
Suppose you are asked to do a market analysis in an area in which a natural disaster has recently occurred. (An example might be Nashville after the spring floods or New Orleans after Hurricane Katrina.)
Other than building supplies (which is too easy :), choose a market for a good or service that will be affected.
Will demand or supply be affected? (Even if it might be both, just choose one or the other to keep it simpler).
What happens to equilibrium prices and output in this market? Draw a supply and demand graph for your own use, and then explain the process in detail.
Choose a market that has not already been chosen by a classmate. Be creative and thoughtful!
In each of the following questions assume that the market is in equilibrium at X. Identify the new equilibrium following the changes given below:
The market is for private education, and it receives a subsidy from the state because it is perceived to be a merit good.
The market is for new housing, and building costs fall following a general fall in oil prices.
The market is for cigarettes, and the government increases indirect taxes and at the same time smoking become less fashionable for people over 30.
The market is for motor insurance, and the price of cars falls and at the same time the government subsidises private motor insurance.
The market is for electronic goods which often employs very low paid assembly workers. The minimum wage rises and interest rates rise which affects consumer confidence.
The market is for student textbooks following a fall in the costs of printing and a considerable increase in the numbers of students going to university.
The market is for…
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