Easy Go
Yiheli Tesfu | Homework I | ECON 545: Business Economics | Sir, Edward Melton | Jan. 5, 2013 |
S2
S2
S1
S1
D2
D2
D1
D1
8.
Using the figures above, answer the following questions:
a. On the Demand panel:
■ Show an increase in demand and label it D1.
■ Show a decrease in demand and label it D2.
■ Show an increase in quantity demanded.
■ Show a decrease in quantity demanded.
■ What causes demand to change?
Answer: Changes in demand comes from various factors. Changes in consumer preferences will change demand. Consumer preferences can be changed through advertising, variations in the price or availability of related products and customers’ incomes. (Stone 58)
■ What causes quantity demanded to change?
Answer: Whereas a change in demand can be brought about by many different factors, a change in quantity demanded can be caused by only one thing: a change in product price. (Stone 59)
b. On the Supply panel:
■ Show an increase in supply and label it S1.
■ Show a decrease in supply and label it S2.
■ Show an increase in quantity supplied.
■ Show a decrease in quantity supplied.
■ What causes supply to change?
Answer: A change in supply results from a change in one or more of the determinants of supply; such as advancing technology has made it cheaper to produce products or cheaper labor availability, means that more of the commodity will be offered for sale at every price. (Stone 63)
■ What causes quantity supplied to change?
Answer: Only a change in the price of a product can cause a change in the quantity supplied. (Stone 63)
11. In December of 2005, the Wall Street Journal reported that Clark Foam, a major supplier of polyurethane cores (blanks) for hand-shaped surfboards, closed its plant and went out of business (Peter Sanders and Stephanie Kang, “Wipeout for Key Player in Surfboard Industry,” The Wall Street Journal, December 8, 2005, p. B1). Clark Foam was the Microsoft of surfboard blank makers, and had been
S2
S2
S1
S1
D2
D2
D1
D1
8.
Using the figures above, answer the following questions:
a. On the Demand panel:
■ Show an increase in demand and label it D1.
■ Show a decrease in demand and label it D2.
■ Show an increase in quantity demanded.
■ Show a decrease in quantity demanded.
■ What causes demand to change?
Answer: Changes in demand comes from various factors. Changes in consumer preferences will change demand. Consumer preferences can be changed through advertising, variations in the price or availability of related products and customers’ incomes. (Stone 58)
■ What causes quantity demanded to change?
Answer: Whereas a change in demand can be brought about by many different factors, a change in quantity demanded can be caused by only one thing: a change in product price. (Stone 59)
b. On the Supply panel:
■ Show an increase in supply and label it S1.
■ Show a decrease in supply and label it S2.
■ Show an increase in quantity supplied.
■ Show a decrease in quantity supplied.
■ What causes supply to change?
Answer: A change in supply results from a change in one or more of the determinants of supply; such as advancing technology has made it cheaper to produce products or cheaper labor availability, means that more of the commodity will be offered for sale at every price. (Stone 63)
■ What causes quantity supplied to change?
Answer: Only a change in the price of a product can cause a change in the quantity supplied. (Stone 63)
11. In December of 2005, the Wall Street Journal reported that Clark Foam, a major supplier of polyurethane cores (blanks) for hand-shaped surfboards, closed its plant and went out of business (Peter Sanders and Stephanie Kang, “Wipeout for Key Player in Surfboard Industry,” The Wall Street Journal, December 8, 2005, p. B1). Clark Foam was the Microsoft of surfboard blank makers, and had been
References: 1 Stone, Gerald W.. CoreEconomics. Worth Publishers, 07/2011. 2 David Talbot. June 2012. The Great German Energy Experiment. Retrieved on Jan. 6, 2013 and available on http://www.technologyreview.com/featuredstory/428145/the-great-german-energy-experiment/ 3 Thilo Grau. March 2011. Survey of Photovoltaic Industry and Policy in Germany and China. Retrieved on Jan. 6, 2013 and available on http://climatepolicyinitiative.org/wp-content/uploads/2011/12/PV-Industry-Germany-and-China.pdf