Microeconomics Homework help

timer Asked: Feb 5th, 2016

Question description

Below is the market for "Isays," a new voice recognition software program. 

[img src="http://learn.flvs.net/webdav/assessment_images/educator_apmicro_v9/06_03FRQ_q05.gif" alt="This is the Isays software market graph"> 

a. How will the market be impacted by a highly successful new ad campaign for Isays? Describe which curve will be impacted, which direction that curve will move and the direction of change for the price and quantity equilibrium. 

b. Estimate the cost of production for Isays using the points on the graph above. Explain your reasoning. 

c. Besides a highly successful ad campaign, identify 3 other events that could shift the demand curve to the right. 

d. If the government imposed a per unit tax on teach sale of Isays, how will the graph be impacted? Add the new line that shows the new tax to the current graph. Discuss the impact of this tax on the Pe and Qe.

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