25 popcorn movie experience gets pricier cinemas are

Info iconThis preview shows page 1. Sign up to view the full content.

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

Unformatted text preview: m popcorn to easier-to-grow field corn, cutting supply and pushing its price higher, too. … USA Today, May 24, 2008 Explain and illustrate graphically the events described in the news clip in the markets for a. Popcorn. b. Viewing movies in the theater. 26. The table sets out the demand and supply schedules for potato chips. Price (cents per bag) 50 60 70 80 90 100 Quantity demanded Quantity supplied (millions of bags per week) 160 150 140 130 120 110 130 140 150 160 170 180 a. Draw a graph of the potato chip market and mark in the equilibrium price and quantity. b. If the price is 60¢ a bag, is there a shortage or a surplus, and how does the price adjust? c. If a new dip increases the quantity of potato chips that people want to buy by 30 million bags per week at each price, how does the demand and/or supply of chips change? d. If a new dip has the effect described in c, how does the price and quantity of chips change? e. If a virus destroys potato crops and the quantity of potato chips produced decreases by 40 million bags a week at each price, how does the supply of chips change? f. If the virus that destroys the potato crops in e hits just as the new dip in c comes onto the market, how does the price and quantity of chips change? 27. Sony’s Blu-Ray Wins High-Definition War Toshiba Corp. yesterday raised the white flag in the war over the next-generation home movie format, announcing the end of its HD DVD business in a victory for Sony Corp.’s Blu-ray technology. The move could finally jump-start a high-definition home DVD market that has been hamstrung as consumers waited on the sidelines for the battle to play out in a fight reminiscent of the VHS-Betamax videotape war of the 1980s. The Washington Times, February 20, 2008 How would you expect the end of Toshiba’s HD DVD format to influence a. The price of a used Toshiba player on eBay? Would the outcome that you predict result from a change in demand or a change in supply or both, and in which directions? b. The price of a Blu-ray player? c. The demand for Blu-ray format movies? d. The supply of Blu-ray format movies? e. The price of Blu-ray format movies? f. The quantity of Blu-ray format movies? 28. After you have studied Reading Between the Lines on pp. 72–73, answer the following questions: a. How high did the retail price of gasoline go in April 2008? b. What substitutions did drivers make to decrease the quantity of gasoline demanded? c. Why would the switch to summer-grade fuel and the seasonal increase in travel normally raise the price of gasoline in the spring? d. What were the two main factors that influenced the demand for gasoline in 2008 and how did they change demand? e. What was the main influence on the supply of gasoline during 2007 and 2008 and how did supply change? f. How did the combination of the factors you have noted in d and e influence the price and quantity of gasoline? g. Was the change in quantity a change in the quantity demanded or a change in the quantity supplied?...
View Full Document

This note was uploaded on 04/04/2012 for the course ECON 251 taught by Professor Blanchard during the Spring '08 term at Purdue University-West Lafayette.

Ask a homework question - tutors are online