Question

The following table represents the market for solar wireless keyboards. Plot this data on a supply and demand graph and identify the equilibrium price and quantity. Explain what would happen if the market price is set at $60, and show this on the graph. Explain what would happen if the market price is set at $30, and show this on the graph. Quantity Demanded Quantity Supplied Price $ 10.00 20.00 30.00 40.00 50.00 60.00 70.00 For each of the following statements, draw a diagram that illustrates the likely effect on the market for eggs. Indicate in each case the impact on equilibrium price and equilib- rium quantity. a. The surgeon general warns that high-cholesterol foods cause heart attacks. b. The price of bacon, a complementary product, decreases. c. The price of chicken feed increases. d. Caesar salads become trendy at dinner parties. (The dress- ing is made with raw eggs.) e. A technological innovation reduces egg breakage during packing

Answer 1

Demand and supply Curves $10.00, 28 $20.00, 24 $30.00, 20 $70.00, 18 $40.00, 16 Quantity $60.00, 15 $50.00, 12 $40.00,9 $60.00,8 $30.00, 6 $70.00,4 $20.00, 3 $10.00, 0 $10.00 $0.00 $20.00 $30.00 $50.00 $60.00 $70.00 $80.00 $40.00 Price Quantity Demanded Quantity Supplied

If Market price is $60 : if market price is $60 then supply quantity of the products increases from 12 to 15 as more sellers are willing to sell their products at higher prices.

However, demand of the product quantity decreases to 8 quantities as customer are not willing to pay higher amount.

If market price is $30 then supply quantity of the products decreases from 12 to 6 only because suppliers are willing to supply less at these price levels.

However, Demand for that product will increase as now more people can afford to buy this product. hence demand increases from 12 to 20.