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

Author Question: Using the supply and demand equations for wheat above, determine how the equilibrium price and ... (Read 61 times)

V@ndy87

  • Hero Member
  • *****
  • Posts: 571
Using the supply and demand equations for wheat above, determine how the equilibrium price and quantity vary with an increase in rainfall(r) holding other factors that influence supply and demand fixed.
 
  How do the equilibrium price and quantity change with an increase in income(I). Answer this comparative statics question using calculus.

Question 2

One aspect of prospect theory is that people tend to
 
  A) be very risk averse to large gains.
  B) be very risk averse to losses.
  C) love losses more than gains.
  D) hate gains regardless of potential losses.



Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

adf223

  • Sr. Member
  • ****
  • Posts: 304
Answer to Question 1

The partial derivatives of the equilibrium price and quantity with respect to r:
p/r = -.1
Q/r = 10
An incremental increase in rainfall will decrease price by .10 and increase quantity by 10 units of wheat.
The partial derivatives of the equilibrium price and quantity with respect to I:
p/I = -.05
Q/I = 5
An incremental increase in consumer disposable income will decrease price by .05 and increase quantity of wheat by five units.

Answer to Question 2

B




V@ndy87

  • Member
  • Posts: 571
Reply 2 on: Jul 1, 2018
Wow, this really help


parker125

  • Member
  • Posts: 332
Reply 3 on: Yesterday
Thanks for the timely response, appreciate it

 

Did you know?

Despite claims by manufacturers, the supplement known as Ginkgo biloba was shown in a study of more than 3,000 participants to be ineffective in reducing development of dementia and Alzheimer’s disease in older people.

Did you know?

People who have myopia, or nearsightedness, are not able to see objects at a distance but only up close. It occurs when the cornea is either curved too steeply, the eye is too long, or both. This condition is progressive and worsens with time. More than 100 million people in the United States are nearsighted, but only 20% of those are born with the condition. Diet, eye exercise, drug therapy, and corrective lenses can all help manage nearsightedness.

Did you know?

Though the United States has largely rejected the metric system, it is used for currency, as in 100 pennies = 1 dollar. Previously, the British currency system was used, with measurements such as 12 pence to the shilling, and 20 shillings to the pound.

Did you know?

Your skin wrinkles if you stay in the bathtub a long time because the outermost layer of skin (which consists of dead keratin) swells when it absorbs water. It is tightly attached to the skin below it, so it compensates for the increased area by wrinkling. This happens to the hands and feet because they have the thickest layer of dead keratin cells.

Did you know?

The horizontal fraction bar was introduced by the Arabs.

For a complete list of videos, visit our video library