This topic contains a solution. Click here to go to the answer

Author Question: In early 2009 the price of computer memory chips rose. In a demand and supply model, shifts in what ... (Read 83 times)

tuffie

  • Hero Member
  • *****
  • Posts: 534
In early 2009 the price of computer memory chips rose. In a demand and supply model, shifts in what curve(s) could have brought about the higher price?
 
  What will be an ideal response?

Question 2

When the price of a movie ticket falls from 14 to 10, the quantity of tickets demanded increases from 500 to 700 a day. What is the price elasticity of demand for movie tickets? (Use the midpoint method.)
 
  What will be an ideal response?



Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

nekcihc358

  • Sr. Member
  • ****
  • Posts: 327
Answer to Question 1

The higher price could have been brought about by an increase in demand, a decrease in supply, or the combination of an increase in demand combined with a decrease in supply. Hence the higher price could have been the result of a rightward shift in the demand curve, a leftward shift in the supply curve, or a combined rightward shift of the demand curve and leftward shift of the supply curve.

Answer to Question 2

The price elasticity of demand = (percentage change in the quantity demanded)  (percentage change in the price). Using the midpoint method to calculate the percentages, the percentage change in the quantity demanded = (700 - 500 )  (600 )  100 = 33.3 percent and the percentage change in the price is (10 - 14 )  (12 ) = -33.3 percent. We ignore the negative sign so that the price elasticity of demand equals (33.3 percent)  (33.3 percent), or 1.00.




tuffie

  • Member
  • Posts: 534
Reply 2 on: Jun 29, 2018
Gracias!


bassamabas

  • Member
  • Posts: 294
Reply 3 on: Yesterday
Excellent

 

Did you know?

Hyperthyroidism leads to an increased rate of metabolism and affects about 1% of women but only 0.1% of men. For most people, this increased metabolic rate causes the thyroid gland to become enlarged (known as a goiter).

Did you know?

Pink eye is a term that refers to conjunctivitis, which is inflammation of the thin, clear membrane (conjunctiva) over the white part of the eye (sclera). It may be triggered by a virus, bacteria, or foreign body in the eye. Antibiotic eye drops alleviate bacterial conjunctivitis, and antihistamine allergy pills or eye drops help control allergic conjunctivitis symptoms.

Did you know?

Acetaminophen (Tylenol) in overdose can seriously damage the liver. It should never be taken by people who use alcohol heavily; it can result in severe liver damage and even a condition requiring a liver transplant.

Did you know?

Side effects from substance abuse include nausea, dehydration, reduced productivitiy, and dependence. Though these effects usually worsen over time, the constant need for the substance often overcomes rational thinking.

Did you know?

The National Institutes of Health have supported research into acupuncture. This has shown that acupuncture significantly reduced pain associated with osteoarthritis of the knee, when used as a complement to conventional therapies.

For a complete list of videos, visit our video library