Homework Answers
In the immediate market period, the supply in the market would be constrained and fixed at a particular level irrespective of the price. Therefore, curve S3 denotes the immediate market period
In the short run, supply can be increased by increasing the variable inputs while being limited by the fixed inputs. Therefore, supply can be increased with an increase in demand but in the limited range compared to the long-run period. Therefore, S1(<S2) denotes short-run period and S2 denotes the long-run period
Ans: D. short run, long run, and the immediate period, respectively
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80 75 70 65 60 55 50 45 40 35 30 25 20 D2 S Price of TV Remote in Dollars D1 0 20 40 60 80 100 120 140 160 Quantity of TV Remotes The above graph shows the supply curve and 2 possible demand curves for a perfectly competitive, constant cost TV remote market. Assume the demand curve is initially D1 and the market is in long run equilibrium. Now assume a very popular new TV show comes...
Refer to Figure 6-24. Suppose D1 represents the demand curve for
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the $2, the price paid by buyers will be
Figure 6-24 Suppose the government imposes a $2 on this market. Price 10 S1 S2 D2 D1 1 2 3 4 5 6 789...
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