Suppose the market for gas-powered generators in Moscow is originally described by the equations P =...
Suppose the market for gas-powered generators in Moscow is originally described by the equations P = 1000 – 5QD and P = 200 + 3QS. This means the market is in equilibrium with a price of $500 and a quantity of 100 generators. Now suppose that climate change exists and an unprecedented ice storm takes hold in the region. As a result the new demand for generators is given by the equation P = 1400 – 5QD.
Solve for the new equilibrium. Sketch a graph that shows
the market before and after the change, and label your graph. In
one sentence, describe how the supply side of the market reacts to
this price change.
Homework Answers
As the demand has changed this has reduced the price to $400 and this will increase the demand for generator to 200 units. Therefore there will be excess demand at this price and producer will sell less quantity because their profit will decrease.
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Suppose the market for gas-powered generators in Moscow is originally described by the equations P =...
Suppose the market for gas-powered generators in Moscow is originally described by the equations P =...
Suppose the market for gas-powered generators in Moscow is originally described by the equations P = 1000 – 5QD and P = 200 + 3QS. This means the market is in equilibrium with a price of $500 and a quantity of 100 generators. Now suppose that climate change exists and an unprecedented ice storm takes hold in the region. As a result the new demand for generators is given by the equation P = 1400 – 5QD. Suppose that Latah...
Suppose the market for widgets can be described by the following equations: Demand: P = 10...
Suppose the market for widgets can be described by the following equations: Demand: P = 10 – Q Supply: P = Q – 4 where P is the price in dollars per unit and Q is the quantity. What is the equilibrium price and quantity? Suppose the government imposes a tax of $1 per unit to reduce widget consumption and raise government revenues. What will the new equilibrium quantity be? What price will the buyer pay? What price will the...
Suppose the market for widgets can be described by the following equations: Demand: P = 20...
Suppose the market for widgets can be described by the following equations: Demand: P = 20 - 1.000 Supply: P = 1.000 -6, where P is the price in dollars per unit and Q is the quantity in thousands of units. What is the equilibrium price and quantity? The equilibrium quantity is thousand units and the equilibrium price is $(Enter your responses rounded to two decimal places.) Suppose the government imposes a tax of $1 per unit to reduce widget...
Suppose that a market is described by the following supply and demaod equations: QD 240-P Suppose...
Suppose that a market is described by the following supply and demaod equations: QD 240-P Suppose that a tax of T is placed on buyers, so the new demand equation is as follows: The new equilibrium price is now P 80, and the new equilibrium quantity is Q 160- Tax revenue is T x Q. Use the green points (triangle symbol) to graph tax revenue for the following tax (T) values: 0, 30, 90, 120, 150, 210, and 240. Laffer...
Suppose that a market is described by the following supply and demand equations: Qs -2P OD...
Suppose that a market is described by the following supply and demand equations: Qs -2P OD 180-P Tu Po mo □ , and the equilibrium quantity is D The equilibrium price in this market is S units Suppose that a tax of T is placed on buyers, so the new demand equation is as follows: 120 T 120_ 프 1204 프 180 T Op - 180 - (P+T) 60 + 00-T 180 4 T Inte hel To p be a...
The market for vodka is described as the following: Supply: P = 5 + QS 10...
The market for vodka is described as the following: Supply: P = 5 + QS 10 Demand: P = 20− QD 5 However, drinking vodka causes $3 worth of harm per bottle to the rest of society, through health care costs, reduced productivity, and drunken mistakes. (a) Sketch a graph of this market. Calculate the private equilibrium price, quantity, producer surplus, consumer surplus, total external costs, and total surplus. (Be careful about fractions.) Label the area of deadweight loss on...
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part b
Suppose that a market is described by the following supply and demand equations Q = 2P QP = 300-P a. Solve for the equilibrium price and the equilibrium quantity. Calculate the consumer and producer surplus 2P =300-P P 2100 Equilibrium price quantity Q = 2(000) =200 Equilibri Suplus: A ABL = ²2 Consumer b. Suppose that a tax of 10 is placed on buyers, so the new demand equation is Q" = 300 - (P+10) Solve for the...
8. Suppose that a market is described by the following supply and demand equations: QS =...
8. Suppose that a market is described by the following supply and demand equations:Qs=1 / 2 pQ0=300-Pa. Solve for the equilibrium price and the equilibrium quantity.b. Suppose that a tax of $ 30 is placed on buyers. Solve for the new equilibrium. What happens to the price received by sellers, the price paid by buyers, and the quantity sold?c. The deadweight loss of a tax is the area of the triangle between the supply and demand curves. Solve for deadweight loss....
Suppose the market demand is described as P = 15 - Qd: , while the market...
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3. Suppose the market for widgets can be described by the following equations: Demand: P= 10 - Q Supply: P=Q-4 where P...
3. Suppose the market for widgets can be described by the following equations: Demand: P= 10 - Q Supply: P=Q-4 where P is the price in dollars per unit and Q is the quantity in thousands of units. a. What is the equilibrium price and quantity? (2 points) b. Suppose the government imposes a tax of $1 per unit to reduce widget consumption and raise government revenues. What will the new equilibrium quantity be? What price will the buyer pay?...
Suppose the market for widgets can be described by the following equations: Demand: P = 20 - 1.000 Supply: P = 1.000 -6, where P is the price in dollars per unit and Q is the quantity in thousands of units. What is the equilibrium price and quantity? The equilibrium quantity is thousand units and the equilibrium price is $(Enter your responses rounded to two decimal places.) Suppose the government imposes a tax of $1 per unit to reduce widget...
Suppose that a market is described by the following supply and demaod equations: QD 240-P Suppose that a tax of T is placed on buyers, so the new demand equation is as follows: The new equilibrium price is now P 80, and the new equilibrium quantity is Q 160- Tax revenue is T x Q. Use the green points (triangle symbol) to graph tax revenue for the following tax (T) values: 0, 30, 90, 120, 150, 210, and 240. Laffer...
Suppose that a market is described by the following supply and demand equations: Qs -2P OD 180-P Tu Po mo □ , and the equilibrium quantity is D The equilibrium price in this market is S units Suppose that a tax of T is placed on buyers, so the new demand equation is as follows: 120 T 120_ 프 1204 프 180 T Op - 180 - (P+T) 60 + 00-T 180 4 T Inte hel To p be a...
part b
Suppose that a market is described by the following supply and demand equations Q = 2P QP = 300-P a. Solve for the equilibrium price and the equilibrium quantity. Calculate the consumer and producer surplus 2P =300-P P 2100 Equilibrium price quantity Q = 2(000) =200 Equilibri Suplus: A ABL = ²2 Consumer b. Suppose that a tax of 10 is placed on buyers, so the new demand equation is Q" = 300 - (P+10) Solve for the...
3. Suppose the market for widgets can be described by the following equations: Demand: P= 10 - Q Supply: P=Q-4 where P is the price in dollars per unit and Q is the quantity in thousands of units. a. What is the equilibrium price and quantity? (2 points) b. Suppose the government imposes a tax of $1 per unit to reduce widget consumption and raise government revenues. What will the new equilibrium quantity be? What price will the buyer pay?...
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