What happens to equilibrium price and the equilibrium quantity of each good described in the situations described below? Illustrate your answers.
a. Sunnyvale is named the most liveable city in the United States. At the same time, the wage rates of homebuilders, electricians, and plumbers in Sunnyvale increase. Describe what happens to the new home market in Sunnyvale.
b. The price of airline fuel falls by 10 percent. At the same time, people’s incomes increase and they prefer to fly to their vacation destinations. Describe what happens to the market for airline travel.
c. Installation costs for small satellite TV dishes fall by 10 percent. At the same time, network owners increase the cost of programming packages shown via satellite TV dish systems. Describe what happens in the market for small satellite TV dishes.