Equilibrium Price and Quantity

Economics
Tutor: None Selected Time limit: 1 Day

 In this market for iPhones, the technology improves while all other factors remain constant. Explain the change(s) in the equilibrium price and quantity.

Sep 24th, 2015

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There has been a marked technological improvements in the iPhone industry. Holding other factors constant, otherwise refered to as ceteris paribus in economic terms, an improvement in the technology used to produce iPhones means that the manufucture have the ability to increse their production levels as well as improve on quality. This means therefore that suppliers are able to manufucture more iPhones at reduced costs. This in effect pushes the supply curve further outwards. The outward shift of the supply curve means the equilibrium price for the iPhones is lowered. At reduced prices therefore, consumers are able to demand more iPhones meaning that the equilibrium quantigy effectively goes up.


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Sep 24th, 2015

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Sep 24th, 2015
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Sep 24th, 2015
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