ECON 200 - Review Questions #3

ECON 200 - Review Questions #3 - Antonio Alarcn ECON 200...

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Antonio Alarcón ECON 200 Review Questions #3 2/18/08 1. When personal computers were first introduced in the 1980s, their price exceeded $5,000. Since then, the price has decreased dramatically. Use supply and demand analysis to explain the price reduction of computers. What effect did the price reduction have on the quantity of computers demanded? 2. A severe frost in 1994 destroyed about 25 percent of Brazil's coffee crop. Using supply and demand analysis, explain the impact of the frost on the price of coffee and the quantity of coffee demanded. 3. The tastes of many U.S. consumers have shifted away from beef and toward chicken. Using supply and demand analysis, explain how this change affects equilibrium price and quantity in the market for chicken and the market for beef. 4. Suppose that the implementation of the North American Free Trade Agreement (NAFTA) permits low-cost shirts, manufactured in Mexico, to enter the shirt market of the United States. Draw a graph showing the likely effects of their entry on the price and quantity of shirts supplied by firms in the United States. 5. Graph and explain how the following events will affect the market for steel produced in
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Antonio Alarcón ECON 200 Review Questions #3 2/18/08 the United States. Show on a graph which curve is affected, which direction it changes,
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ECON 200 - Review Questions #3 - Antonio Alarcn ECON 200...

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