Beachfront resorts have an inelastic supply and automobiles


Beachfront resorts have an inelastic supply, and automobiles havean elastic supply. Suppose that a rise in population doubles thedemand for both products (that is, the quantity demanded at eachprice is twice what it was.)

a) what happens to theequilibrium price and quantity in each market?

b) which productexperiences a larger change in price?

c) which product experiencesa larger change in quantity?

d) what happens to total consumerspending on each product?

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Microeconomics: Beachfront resorts have an inelastic supply and automobiles
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