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HW_ch3 - the same product is Q S A =-60 3 P A i Graph the...

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Homework Question for Chapter 3 The Demand for product A is initially given by the following equation Q D A = 100 - 2 P A + 2 I where P A is the price of the good and I is the average Income of consumers. (say I=$10) 1. (a) Is product A a normal or inferior good? Explain. (b) What is something that would cause this demand curve to shift to left? Be specific. (c) Given the demand curve described above where I = 10 and the supply curve for
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Unformatted text preview: the same product is Q S A =-60 + 3 P A . i. Graph the supply and demand curves on the same axis. (Note: Make certain to include all intercepts in the first quadrant.) ii. Calculate and demonstrate the equilibrium quantity and price for this market. iii. What would happen to the equilibrium values of price and quantity if the supply curve changed to Q S A =-20 + 3 P A ? Why?...
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