Introduction to Microeconomics(assignment#2)

# Introduction to Microeconomics(assignment#2) - Assignment...

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1 Assignment #2 Introduction to Microeconomics Student Name: Student #: Chapter 3 (p. 82-83) Q5. In a recent study, the supply schedule of lobsters from the Atlantic Provinces was determined to be *1 : Price of lobster (\$ per pound) Quantity of lobster supplied (pounds) *1 Quantity of lobster demanded (pounds) *2 Quantity of lobster demanded (pounds) *3 \$25 800 200 100 20 700 400 300 15 600 600 500 10 500 800 700 5 400 1,000 900 Suppose these lobsters can only be sold in Canada. The Canadian demand schedule for Atlantic lobsters is *2 : a. Draw the demand curve and the supply curve of Atlantic lobsters. Supply curve in Atlantic Provinces Equilibrium Demand curve in Canada Equilibrium price Equilibrium quantity 0 5 10 15 20 25 30 0 200 400 600 800 1000 1200 Price of lobster (\$) Quantity of lobster (pounds)

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2 What is the equilibrium price and quantity of lobsters? Answer: The equilibrium price of lobsters is \$15 and the equilibrium quantity of lobsters is 600 pounds. Suppose now Atlantic lobsters can be sold in France. The French demand schedule for Atlantic lobsters is given below *3 : b. What is the demand schedule for Atlantic lobsters now that French consumers can also buy them? Draw a supply and demand diagram that illustrates the new equilibrium price and quantity of lobsters. Supplied in Atlantic Provinces New Equikibrium Demanded in Canada Demanded in Canada & France 0 5 10 15 20 25 30 0 200 400 600 800 1000 1200 1400 1600 1800 2000 Price of lobster (\$ ) Quantity of lobster (pounds) Price of lobster (\$ per pound) Quantity of lobster demanded(pounds) \$25 300 20 700 15 1100 10 1500 5 1900
3 What will happen to the price at which Atlantic fishermen can sell lobster? Answer: Atlantic fishermen can sell lobster at \$20 price. What will happen to the price paid by Canadian consumers of Atlantic lobster? Answer: The price paid by Canadian consumers of Atlantic lobster is same with French consumers. What will happen to the quantity of Atlantic lobster consumed by Canadians? Answer: The quantity of Atlantic lobster consumed by Canadians will increase from 600 pounds to 800 pounds. Q8. Assume that Devon Spank is a star hitter for the Toronto Blue Jays baseball team. He is close to breaking the major league record for home runs hit during one season, and it is widely anticipated that in the next game he will break that record. As a result, tickets for the team’s next game have been a hot commodity. But today it is announced that, due to a knee injury, he will

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## This note was uploaded on 02/20/2010 for the course BBA BBA101 taught by Professor Everyon during the Three '10 term at University of New England.

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Introduction to Microeconomics(assignment#2) - Assignment...

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