Tute03 - answer

Tute03 - answer - ECF1100: MICROECONOMICS Answers to...

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ECF1100: MICROECONOMICS Answers to tutorial 3 Chapter 3, Problem 2 In each of the following cases, the supply curve will shift to the a. right. The discovery is a technological improvement. The improved technique would enable more wheat to be produced with the same inputs. b. left. Fertiliser is an input, and higher input prices mean that less wheat will be supplied at each price. c. right. The drought relief makes farming relatively more profitable than before. Thus those who were employed in a job that was just a little better than being a wheat farmer would switch to wheat farming. d. left. Droughts reduce productivity and destroy crops. Chapter 3, Problem 3 a. Demand curve shifts to the right if overseas vacations are a normal good. b. Demand curve shifts to the left since the health scare causes preferences to shift away from mobile phones. c. Demand curve shifts to the right since the price of a substitute has risen. d.
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This note was uploaded on 08/30/2011 for the course ECON 101 taught by Professor Shen during the Three '11 term at Monash.

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Tute03 - answer - ECF1100: MICROECONOMICS Answers to...

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