1. In the market for tacos, explain the impact on the demand curve, supply curve, or both. If the market started in equilibrium, determine if the new market equilibrium price and quantity are above, below, or indeterminate with respect to the starting equilibrium.
a. There is an increase in the price of beef.
b. The taco industry decreases the price of tacos to boost sales.
c. As the economy recovers from the recession, consumers are finding themselves with increased incomes. Also, many new restaurants, including those that sell tacos, open.
2. Using the above table, The Market for Chocolate-Covered Peanuts, to answer the following:
a. What are the equilibrium quantity and the equilibrium price in this market? Explain.
b. If the government imposes a price ceiling of $0.40, what is the impact on the market with respect to the quantity supplied, quantity demanded, and the equilibrium? Explain.
3. Look at the above table: Consumer Surplus. If the price of a ticket to see The Nutty Nutcracker is $75 and there is no other market for tickets, calculate the total consumer surplus for the five students. Be sure to show your work.
4. The above graph shows the weekly market for hamburgers in Tuscaloosa. If the market is in equilibrium, calculate the following: (Be sure to show your work)
a. Consumer Surplus
b. Producer Surplus
c. As hamburgers gain popularity, how does this impact the demand curve in the market? What is the impact on the consumer and producer surplus?