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Demand & Supply

Economics - Price Elasticity of demand

Suppose that the current market price of VCRs is $300, that the average consumer disposable income is $60,000, and that the price of DVDs (a substitute for VCRs) is $500. Under these conditions annual U.S. demand for VCRs is 10 million per year. Statistical studies have shown that for VCRs the own-price elasticity of demand is -

Question and answer

There are four factors that influence the price elasticity of demand: availability of substitutes, the specific nature of the good, the part of income spent on the good, and the time you have to buy the good. Pick a good you have purchased in the past week at a grocery or convenience store. Describe how each of the factors contr

Economic question

Markets may be local, national, or global. The extent and size of the market is, in part, determined by how easy it is for suppliers to offer their product to buyers and how easy it is for buyers to find suppliers. How has the Internet expanded the extent and size of markets for goods and services? What specific examples can you

Economics

Quantity supply (domestic) Price Quantity demand (domestic) 12 $5 2 10 4 4 7 3 7 4 2

Air Travel demand

Rising jet fuel prices recently led most major US airlines to raise fares by approximately 15%. Explain how this substantial increase in airfares would affect the following: 1) The demand for air travel 2) The demand for hotels 3) The demand for rental cars 4) The supply of overnight mail

Money and Financial Markets

Suppose the ratio of deposits that banks hold in the form of reserves is 7 percent. Suppose further that people want to hold 8 percent of their deposits in the form of cash. Then, if the fed wants the money supply to be $6,228 billion, what is the necessary level of high powered money? Assume an economy in which the reserve

A change in the demand

The demand for a product can change due to many factors. Distinguish between a change in demand and a change in quantity demanded. What are the determinants of demand? What are the determinants of supply? Explain each and give at least one example for each of these factors. Use your experiences, the text, the South University On

Answers: In economics, the demand for a product is considered downward sloping. This implies that demand increases when price decreases. Is this always true? Name some products for which the demand remains unchanged regardless of the price. Also, mention some products for which demand increases when the prices increase. Give appropriate examples and justify your answer.

In economics, the demand for a product is considered downward sloping. This implies that demand increases when price decreases. Is this always true? Name some products for which the demand remains unchanged regardless of the price. Also, mention some products for which demand increases when the prices increase. Give appropriate

Discussion Question

#1 Perform an economic cost/benefit analysis on one of the following issues. You must have both 2-3 costs and benefits and conclude whether a net benefit or cost exists. -Move to government provided national health care system -Increase tax rates on the rich (back to pre-2001 levels) -Close borders and implement an im

Equilibrium Price and Quantity Demand

The following table shows the quantities of corn supplied and demanded at different prices. Price per Ton Quantity Supplied Quantity Demanded $80 600 1,200 $90 800 1,100 $100 1,000

The Aggregate Demand for goods and services

True or false and explain: The Aggregate Demand for goods and services in an economy must at every moment equal the value of Real Gross Domestic Product because both are defined to be the sum of (C+I+G+X-IM).

Market Failure and the Government

What is significant about the connection between the demand for goods and market failures? What happens to the demand for goods when a market fails, and how does the government regulate market failures?

Microeconomic Theory Example Problems

1. Country A is a country that produces a variety of goods and services. Considering the policies/events listed below, how might country's A production possibilities frontier change (ie shift out or in)? a. The government deregulates industries. b. The government increases military spending. c. The government increases tax

Article Analysis

I need help with the following assignment. Please see the link for the article. Prepare a 600-word paper in which you: a. Define economics b. Define microeconomics c. Define the Law of supply d. Define the Law of demand e. Identify the factors that lead to a change in supply and a change in demand Analyze th

Horizontal Sum of Competitor MC Curves

Graphically, competitive market supply is measured by the vertical difference of competitor demand curves. vertical sum of competitor demand curves. horizontal difference of competitor MC curves horizontal sum of competitor MC curves.

Income and Demand

The recent recession has hurt several industries due to a decline in demand by households. Thinking of the relationship between income and demand discuss the following questions: 1. What are "normal" goods? Give an example in our current economy. 2. What are "inferior" goods? Give an example in our current economy.

Differentiating between Market Structures Simulation

Economics, Cost-Benefit Analysis - Year 4 Differentiating between Market Structures Simulation Prepare a table that compares and contrasts the various characteristics of the four market structures. Format the table as follows: a. Column headings should be the four market structures: 1) Perfect competition 2) Monopoly 3

Consider two firms X and Y produce identically tasting cold drinks. In order to increase the demand for its cold drink, firm X increases its advertisement outlay. However the advertising doesn't increase its demand in the long run. Explain why this must be the case.

Consider two firms X and Y produce identically tasting cold drinks. In order to increase the demand for its cold drink, firm X increases its advertisement outlay. However the advertising doesn't increase its demand in the long run. Explain why this must be the case.

Description of Equilibrium Price and Quantity

The majority of the world's diamonds comes from Country A and Country B. Suppose that the marginal cost of mining a diamond is $1,000 per diamond and that the demand schedule for diamonds is as follows: Price Quantity $6,000 5,500 $5,000 6,500 $4,000 7,500 $3,000 8,500

Supply and Demand simulation

Using the link provided in the integrated, access and complete the Supply and Demand simulation. Based on your learning, reading, and on the simulation, prepare 750 words and summarize the content. Be sure to address the following: a. What causes the changes in supply and demand in the simulation? b. How do shifts in supp

In 2000, the Firestone unit of Japanese tire maker Bridgestone and Ford Motor Co. began publicly pointing fingers at each other after a number of people were killed driving Ford's Explorer vehicles when the tires failed. Were the failures due to inappropriate tire pressure, the tires' design, the Explorers on which the tires were mounted, the speed at the time of failure, or perhaps a combination of these factors? Princeton economists Alan Krueger and Alexandre Mas have a completely different explanation. They noted that a disproportionate number of faulty tires were made in Bridgestone's Decatur, IL plant where there had been a bitter labor dispute. They claim that labor strife was "a major contributor to faulty tires - though not, as the union argues, because strikebreakers were incompetent." It appears that tires made at Decatur during a 1994-1996 labor dispute were more likely to fail than tires made there earlier or later. They were also more likely to fail than tires made at Bridgestone's nonunion plant in Wilson, NC, or its plant in Joliette, Quebec. The bitterness broke out when Bridgestone began pressing for wage cuts and 12-hour shifts in January 1994. In July the workers struck. Using replacements, management imposed their 12-hour shifts and kept production moving along. In May 1995, the workers gave up, accepted lower wages and 12-hour shifts, and worked alongside the replacement workers. The economists found that Firestone tires made during the labor strife in Decatur were 376 percent as likely to prompt a complaint to the National Highway Transportation Safety Administration than tires made in Wilson or Joliette. At times of labor peace, Decatur tires were 14 percent less likely to prompt a complaint. Source: David Wessel, "The Hidden Cost of Labor Strife," The Wall Street Journal, January 10, 2002, p. A1. IN 250 WORDS PLEASE ANSWERS THE 5 QUESTIONS BELOW: Questions: 1. Is this a case of sabotage? 2. Does the case suggest that squeezing workers, even in an age of weakened unions, can be bad management? 3. Is this a case where social and political forces are at work? 4. Does this case illustrate the derived demand for labor? If so, how? 5. Does this case illustrate the elasticity of the supply of labor? If so, how?

Deadly Labor Dispute Labor theory has a built-in harmony bias: treat workers well and they will work harder. Treat them shabbily and they'll get even. In 2000, the Firestone unit of Japanese tire maker Bridgestone and Ford Motor Co. began publicly pointing fingers at each other after a number of people were kill

Price discrimination for medical services can often be legal. T F

A. Price discrimination for medical services can often be legal. T F b. Medicare and Medicaid cover about 80 million people? c. One must be age 65 or older to get Medicare. d. Everyone in Medicare has access to prescription drugs. e. Medicaid is available to all people above age 65. f. Monopsony power rests i

Demand curve

Jane spends all her income on hot dogs and caviar. Her demand curve for caviar is inelastic at all prices for caviar. Unfortunately, the accident at Chernobyl has caused the supply of caviar to fall and the price to rise. What has happened to Jane's consumption of hot dogs? Explain. (Note: you should assume that the accident at

Stagflation

I have answered the first part of the question but am having problems with the second part of it, I would really appreciate any help that you could give me. 1.(Stagflation) What were some of the causes of the stagflations of 1973 and 1979? In what ways were these episodes of stagflation different from the Great Depression of

Law of supply, equilibrium and government intervention

The US Postal Service is facing increased competition from firms providing overnight delivery of packages and letters. Additional competition has emerged because messages can be sent via computers. What will be the effect of this competition on the market demand for mail delivered by the post office? Substantiate your argument b

Finding Supply function/equation

For a certain commodity, the demand equation is given by D = -5p + 50. At a price of $1, twelve units of the commodity are supplied. If the supply equation is linear, and the market price is $4, find the supply equation.

Microeconomics - Elasticity and Equilibrium

If the own-price elasticity of demand for gasoline is -.2 and there is a 10% increase (+.10) in the price of gasoline, what will be the percentage change to the equilibrium demand for gasoline?