PS1 fall 2019 (1).docx - Economics 103 Professor Friedman...

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Economics 103Your Name(sProfessor FriedmanYour TA:____________________________________________Fall 2019Your Section Time and Day:_____________________________Problem Set 1Due Date: October 21 by 4PMHand in hard copy to your TA’s mailbox, 1stfloor of Gordon HallDo not submit answers on line through MoodleNote that there are two types of problems. You are encouraged to work with someone else in your TA section on the quantitative problems (1, 2, 3, 4); hand in one set of answers to this problems with both your names.Do the essay questions individually (5 and 6) and append separate answers with each person’s name for this along with your group answers to the quantitative questions. Type your answers; hand-written answers will be accepted only by special arrangement. Staple pages together. Be sure to keep a copy of your answers just in case.This problem set is so much easier to do using a computer spreadsheet that I am tempted to require that you use a spreadsheet. Total 20 points.1.(3 points) Made the right way steamed mussels is delicious. Your friend Rihanna has abandoned her music career to open a bistro, which specializes in French cuisine and, includingmussels. She has done some market research and finds that your neighbors valuemusselsaccording to the following schedule: servingMU mussels1$32.00 2$29.76 3$27.68 4$25.54 5$23.75 6$22.09 7$20.54 8$19.11 9$17.77 10$16.52 a.(1 points) Graph the demand curve for mussels. Does the demand curve have a positive or negative slope? Why?1
12345678910$0.00 $5.00 $10.00 $15.00 $20.00 $25.00 $30.00 $35.00 MU mussels
b.(1 point) How many servings will Rihanna sell at $32? How many at $25.54? $17.77?At
c.(1 point) What will happen to the demand curve if a new study comes out showing shellfish and onions (ingredients inRihanna’s mussels) increase the risk of cancer? What will happen to the demand curve if instead a study comes out showing they reduce the risk of heart disease?

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