Short Assignment 1
Use supply and demand sketches to depict each of the following effects on the market indicated. Assume all other factors that might affect supply or demand are held constant.
Please clearly label your graphs. For example label the axes Price and Quantity or P and Q appropriately. Indicate the initial price P1 and quantity Q1. Label the initial demand curve D1 and the initial supply curve S1.
If there is a new demand curve label it D2. If there is a new supply curve label it S2. If after the change the price paid by the consumers is the same as the price received by the sellers simply label it P2. If they are different please label them Pc and Ps respectively. If after the change the quantity demanded by the consumers is the same as the quantity supplied by the sellers simply label it Q2. If they are different please label them QD and Qs respectively. Clearly indicate the direction of any change in the market.
1. The effect of an increase in incomes on the market for home appliances.
2. The effect of a rise in the cost of gasoline on the market for large sports utility vehicles.
3. The effect of a decrease in incomes on the market for Do-It-Yourself books.
4. The effect of an improvement in production technology on the market for calculators.
5. The effect of a decrease in the price of digital cameras on the market for film.
6. The effect of a tax on the market for soda with sugar in it.
7. The effect of "rent control" (a price ceiling) on the market for rental housing below the current market rent level.
8. The effect of fishing licensing/registration requirements on the market for fishing rods.
9. The effect of a government
10. The effect of a government
program in which the government agrees to purchase, at a price 20 percent above
the current market price, all of the milk