HW2 - Situation Supply curve shifts Demand curve shifts...

Info icon This preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Problem Set #2 1. Consider the market for laptop computers. In each of the following situations, determine whether there is a change in supply, or a change in demand, and in which direction. Indicate also what happens to the equilibrium quantity and price. It may help to sketch on the graphs below. As an example, the first one is done. a. laptop computers become seen as geeky and unfashionable. b. consumer income rises (assume laptop computers are a normal good) c. The price of semiconductors falls d. A new processor increases the processing speed of laptops, but costs more to produce. e. the cost of computer software rises f. the cost of desktop computers rises
Image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: Situation Supply curve shifts? Demand curve shifts? Equilibrium quantity ? Price? a no left falls falls b c d e f Quantity Price D S Quantity Price D S Quantity Price D S Quantity Price D S Quantity Price D S Quantity Price D S 3. Suppose that the supply and demand equations are given by the equations below: Demand: Q d = 16 – 2P Supply: Q s = -8 + 2P A. Find the equilibrium price and quantity. B. Suppose that there is an increase in income. After the change the demand curve is given by Q d = 20 – 2P. Find the new equilibrium price and quantity. C. What does the change in demand tell us about the good?...
View Full Document

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern