Basic Hill Method for Suppy and Demand

User Generated

zuwnore03

Economics

Moraine Valley Community College

Description

I need to complete 4 questions for Basic Macroeconomics. They must be done using the Hill Method that will be provided.


These are the questions:

1.The price of corn is held above equilbrium. Use the full Hill method to show what happens to price and quantity of corn.

2. Show Unemployment on the production possibilities curve and label all axis.

3. Draw the business cycle labeling all axis and stages.

4. The cost of making cars increases and at the same time people start prefering cars to trucks. Use the full Hill method to show what happens to price and quantity.

I will provide the book and page numbers where it goes into detail on how to answer the questions using the Hill Method.

Email : mohjaber03@gmail.com

Just email me for the book. It wont let me link it.








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Explanation & Answer

Attached.

1

Basic Hill Method for Supply and Demand

Institution Affiliation:
Student’s Name:
Professor’s Name:
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2

Basic Hill Method for Supply and Demand
1. The price of corn is held above equilibrium. Use the full Hill method to show what
happens to the price and quantity of corn.
The graph shows what would happen to the economy if the price of corn is kept above its
equilibrium by such external intervention as government policies. This assumption is based on
supply and demand principles where the initial price balance was determined by both curves
meeting at a point. However, when this natural equilibrium position is ignored and prices soar
beyond this state, it disrupts market equilibrium without affecting the foundation determinants of
supply and demand like production technology, input prices, consumer tastes, etc.
Despite no change in these fundamental determinants, the artificial price elevation directly
impacts the "Price" determinant, leading to a distortion in the market dynamics. This imposed
price level results in a surplus of corn, characterized by excess supply over deman...


Anonymous
Just what I was looking for! Super helpful.

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