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How much would a perfectly competitive firm produce at each of the indicated prices? At which prices is firm earning economic profits? Zero economic profits?
Illustrate the SRATC, AVC, MC, and MR curves for a perfectly competitive firm that is operating at a loss. What is the output level that minimizes losses?
Discussion how might your elasticity of demand for copying and binding services vary if your work presentation is next week versus in two hours?
Analyze what will happen to the quantity of tickets demanded? What will happen to the quantity supplied? Who gains? Who loses?
Discuss what would be the impact of a price floor set above the equilibrium price for dairy products? Below the equilibrium price?
Discuss what would be the impact of a rental price ceiling set above the equilibrium rental price for apartments? Below the equilibrium rental price?
What happens to the quantity supplied, the quantity demanded, and the shortage if, for a given price ceiling, the demand curve shifts to the right?
What happens to the quantity supplied, the quantity demanded, and the surplus if, for a given price floor, the demand curve shifts to the right?
In Canada, why is fresh fruit (apples, strawberries, peaches) less expensive in the summer than in the winter?
Why do 10 A.M. classes fill up before 8 A.M. classes during class registration? Use supply and demand curves to help explain your answers.
What do you think is causing the shortage? What would you advise the deputy parks commissioner to do to alleviate the shortage?
Explain why using the midpoint formula for calculating the elasticity of demand gives the same result whether price increases or decreases.
Why is a more narrowly defined good (e.g., pizza) likely to have a greater elasticity of demand than a more broadly defined good (e.g., food)?
Predict what will happen to the quantity demanded of hamburgers when the price increases by 10 percent. If the price falls by 5 percent, what will happen?
Bad weather spoils the orange crop. Over this price range, calculate the price elasticity of demand (using the midpoint method).
Isabella always spends $50 on red roses each month and simply adjusts the quantity. What can you say about Isabella's elasticity of demand for roses?
If the midpoint on a straight-line demand curve is at a price of $7, what can we say about the elasticity of demand for a price change from $12 to $10?
If the local bus company raises its price per rider from $2.50 to $2.75 and its total revenues rise, what can we say about its elasticity of demand?
At what level should the price be set? Where is demand elastic, inelastic, or unit elastic? Explain.
If a 10 percent decline in the price of WiFi service increase. Calculate the cross-price elasticity of demand between WiFi service and mobile computing devices.
If a 10 percent rise in price of coffee increases the quantity of tea demanded by 25 percent. Calculate the cross-elasticity of demand between coffee and tea.
Are air travel and rail travel substitutes or complements? Calculate the cross-price elasticity of demand for intercity rail travel.
If the government imposes a price ceiling of $800 on this market, discuss the size of the resulting apartment shortage.
What about an 8 percent decline in the price of tablet computers?
In which case would the tax burden fall primarily on consumers? In which case would the tax burden fall primarily on producers?