Question

market for coflco? b) WhTCh o or show graphically with before- and after-curves on the same axes, the shifn that occurs How will this change the equilibrium price and quantity of coffee? Explain your reasoning Suppose the Autoworkers Union representing workers at the Kentucky BMW plant negotiate a $5.00 an hour wage increase. a) How do you imagine this will affect the market for BMW cars/SUVs? b) Which determinant of demand or supply is being affected? c) Describe or show graphically with before- and after-curves on the same axes, the shift that occurs. d) How will this change the equilibrium price and quantity of BMW cars/sUvs? 3. Explain your reasoning. (*) Ko last of , rod.c4/>of BMw-in will İncrease.. The current political upheaa th Veneziela an embargo has been placed on the import organic coffee beans a favorite of "hip" urban coffee drinker. a) How do you imagine this will affect the market for domestic organic coffee beans? b) Which determinant of demand or supply is being affected? c) Describe or show graphically with before- and aft the same axes, the shift that occurs. d) How will this change the equilibrium price and quantity of domestic organic coffee beans? Explain your reasoning

plz solve question 4

Answer 1

Ans 4.) Throughout the question we assume that the imported organic coffee beans and domestic organic coffee beans are perfect substitutes.

Ans a.) As the embargo is imposed on imported coffee beans,the supply of it goes down and its price goes up. As the perfect substitute relationship tells us, the demand for domestic organic coffee beans would go up.

Ans b.) Since the price is determined by price of the good, price of substitute goods, price of complementary goods, income ,taste and preference. Therefore in our case price of substitute good is being affected.

Ans c.) Due to an increase in the price of imported coffee, the demand for domestic organic coffee beans goes up and thus demand curve shifts to the right to D'

Ans d.) In the new equilibrium,the price and quantity of domestic coffee beans has increased.