exam 1 - L. Demand 550 L. Supply L. Demand Wage L. Supply5...

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Dm Q Dw Q P The demand cure for men is more elastic, and less sensitive to price. Q Q In the haircut example, this graph shows the demand curve for women; being inelastic P 50 5 L. Demand L. Supply Employment Wage Wage 50 5 L. Demand L. Supply Employment Wage 5 L. Demand L. Supply 50 Employment Wage 5 L. Supply Employment L. Demand 50 Employment L. Demand 50 Wage 5 L. Supply Employment 50 Wage 5 L. Supply L. Demand Part One When it comes to various goods and services, prices that men and women each pay differs. Men and women view certain goods and services in a different light. In class we talked about the example of hair cuts. Men have a more elastic demand for haircuts, while women sway more towards inelastic demand. Price has a big effect of the quantity demanded for men. Yet when it comes to women, price has a much less drastic effect. This makes it possible for hair salons to charge a different price to both men and women. There are other small factors that also come into play. Regarding the hair cut example, it takes much more time to cut a woman’s hair than a man’s. I have constructed a supply and demand curve below to illustrate. If there were a law to ban gender-based price differences, than there would be many potential advantages and disadvantages. If suppliers must come up with a fair price to offer to both men and women, than I’m assuming that they would create that price somewhere in the middle. This would ensure that a supplier does not lose an entire gender when changing price. When looking at the example regarding haircuts, let’s assume that a woman’s haircut is $50 and a man’s haircut is $15. To compromise, the summplier would make the price of any haircut about $30. In doing so, women would get a hair cut more frequently, while men would receive a hair cut less frequently. Part Two #1
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This note was uploaded on 04/05/2011 for the course ECON 350 taught by Professor Kilborne during the Spring '10 term at Grand Valley State.

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exam 1 - L. Demand 550 L. Supply L. Demand Wage L. Supply5...

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