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ECON 101 Study Guide - Midterm Guide: Price Ceiling, Economic Equilibrium, Social Cost

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turquoisegnu128
24 Oct 2018
School
UBC
Department
Economics
Course
ECON 101
Professor
All

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ECON 101 Full Course Notes
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ECON 101 Full Course Notes
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D: starting from the equilibrium, a price ceiling equal to will lead to. 40: (show your work) here is the market for cashew nuts: ____ (c) find the elasticity of demand at equilibrium. P = _________ , q = _________. (e) calculate the income elasticity if the demand shifts to qd = 80-2p when your income falls by 20% _____ (g) complete the table and diagrams below showing the results of the following two policies (use the original demand and supply for comparison) Question 1 to 3 refer to figure 1. Figure 1: starting from the equilibrium, a price ceiling equal to will lead to. Note: both b and d are right answers for this question. 2: an economist tells you that people in canada have an average level of personal debt which is too high. 60: (show your work) here is the market for cashew nuts: Quantity supplied (a) find the equation for demand.

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Use the accompanying graph to answer these questions. (LO2, LO3, LO4) a. Suppose demand is D and supply is S0. If a price ceiling of $6 is imposed, what are the resulting shortage and full economic price? b. Suppose demand is D and supply is S0. If a price support of $12 is imposed, what is the resulting surplus? What is the cost to the government of purchasing any and all unsold units? c. Suppose demand is D and supply is S0 so that the equilibrium price is $10. If an excise tax of $6 is imposed on this product, what happens to the equilibrium price paid by consumers? The price received by producers? The number of units sold? d. Calculate the level of consumer and producer surplus when demand and supply are given by D and S0 respectively. e. Suppose demand is D and supply is S0. Would a price ceiling of $2 benefit any consumers? Explain.

Price CSO 01 02 03 04 Quantity 27. Refer to figure F998. If the market in this figure is in equilibrium at P Q. and the demand curve shifts to Do what will happen if the government imposes a price ceiling at Pı? a. There will be an increase in supply to regain equilibrium b. A surplus of the amount D-A will occur. C. A shortage of the amount Q3 - Q1 will occur. d There will be Qi units actually bought. e. Both c and d.