Economics Question

Economics

University of North Carolina at Chapel Hill

Question Description

These activities are designed to give you a deeper understanding of course concepts and they will be graded for completion (100%, i.e., you must answer every part to every question) and accuracy (60% or better). You must reach those targets to receive credit (1 point), otherwise you get no credit (0 points).

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Recitation #2 Spring 2021 You are encouraged to work on these exercises during your designated recitation. During that time, you will work through these problems in small groups with several of your peers. Your TA will be available to answer your questions and provide guidance. document and upload that document to Gradescope by 11:55pm on Thursday, February 4th. We will accept group submissions where the group is no more than 4 people, but please make sure that you follow these directions when you upload your assignment to Gradescope (https://help.gradescope.com/article/m5qz2xsnjy). For more information on how to submit homework to Gradescope and other frequently asked questions, follow this link (https://www.gradescope.com/help#help-center-section-student-workflow). These activities are designed to give you a deeper understanding of course concepts and they will be graded for completion (100%, i.e., you must answer every part to every question) and accuracy (60% or better). You must reach those targets to receive credit (1 point), otherwise you get no credit (0 points). 1. The table below displays the amount that three different consumers are willing and able to pay for three oranges in a given day. Use this information to answer the questions that follow. Sean Kaylie Drew First Orange $2.00 $1.50 $0.75 Second Orange Third Orange $1.50 $0.75 $1.00 $0.80 $0.25 $0 a. If the market price of an orange is $0.75, the market quantity of oranges demanded per day is ____ and the value of consumer surplus is _____. b. If the market price of an orange increases from $0.75 to $1.00, will consumer surplus increase or decrease? By how much? (insert a monetary value and show your work). 2. The table below represents the value that 4 students place on a used economics textbook. Assume that each student is only interested in buying one textbook. BUYER MIKE SANDY JONATHAN HALEY B e Val e $50.00 $30.00 $40.00 $10.00 Use the information provided to complete the demand schedule given below. Assume buyers will purchase a textbook whenever they are indifferent. Use the information in the demand schedule to draw the demand curve for used economics textbooks. Make sure you label both axes. 1 Price $60 $50 $40 $30 $20 $10 $0 Qty. Demanded 3. Below are 5 students, each of whom owns a used economics textbook. Next to each student is the value that the student puts on their textbook. David Ivan Wanda Phillip Value $40 $10 $20 $30 Use the information provided to complete the supply schedule below. Assume the students will sell their textbook whenever they are indifferent. Draw the supply curve for the used economics textbook market. Make sure you label both axes. Price Qty. Supplied $0 $10 $20 $30 $40 $50 $60 Given the supply and demand schedules in problems 2 and 3, what is the equilibrium price and the equilibrium quantity of used economic textbooks? Assume that when indifferent, the student will buy or sell. 2 4. During the COVID-19 pandemic, beer and soda consumption shifted from restaurants to homes and beverage companies and can-makers had a hard time keeping up because they were not ready for drink consumption to go from tap to the home. A Coca-Cola spokesperson said, Al min m can a e in e igh ppl i h o man people b ing mo e m l ipack products o con me a home (Bomey, N. (2020, July 16). Another shortage! Beer, soda makers struggle with aluminum can supply, plan to limit niche drinks. USA Today.) a. Draw the market for aluminum cans before the pandemic. Label the equilibrium price and quantity (Q0, P0). b. Now add to the graph in part a) the impact that the pandemic had on the market for aluminum cans, i.e., was there initially a change in supply or a change in demand? Identify the new equilibrium price and quantity in the market for aluminum cans (Q1, P1). c. Over the summer, aluminum can manufacturers announced plans to build at least three factories within 18 months. How will this information affect the price and quantity in the market for aluminum cans? Draw a new supply and demand graph and label the initial equilibrium price and quantity (Q0, P0). On your graph, show the impact that the new factories will have on the equilibrium price and quantity in the market for aluminum cans (Q1, P1). d. In this part of the question, we want you to compare the price and quantity of aluminum cans pre-pandemic to the price and quantity of aluminum cans after the pandemic hit and the 3 factories were built, i.e., you are going to analyze collectively parts a), b), and c). Do you expect the price of aluminum cans to be higher or lower after the factories are built? Explain. What do you expect to happen to the quantity of aluminum cans after the factory is built? Explain. Feel free to draw a graph to support your answer. 3 ...
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