MICROECONOMICS
Chapter 5 – Check Your Understanding
1. When the demand curve is relatively inelastic and the price falls, what happens to total revenue? If the demand is relatively elastic and price rises, what happens to total revenue?
2. Why is the demand for gasoline relatively inelastic, while the demand for Exxon’s gasoline is relatively elastic?
3. Describe cross elasticity of demand. Why do substitutes have positive cross elasticities? Describe income elasticity of demand. What is the difference between normal and inferior goods?
4. Describe and explain the impact of time on the price elasticity of supply. Draw graph
5. Why would the demand for business airline travel be less elastic than the demand for vacation airline travel by retirees?
6. Would an excise tax placed on cereal be more likely or less likely to be passed on to consumers than an excise tax on wireless phone and data services? Why or why not?
Apply the Concepts
7. One major rationale for farm price supports is that rapidly improving technology, better crop strains, improved fertilizer, and better farming methods increased supply so significantly that farm incomes were severely depressed. Explain how the elasticity of demand for these crops influences this rationale.
8. If the price of chicken rises by 15% and the sales of turkey breasts expand by 10%, what is the cross elasticity of demand for these two products? Are they complements or substitutes?
9. For which of the following pairs of goods or services would the cross elasticity of demand be negative? (a) Uber and Yellow Cab, (b) movie streaming subscriptions and tablets, (c) camping tents and camping permits, (d) bowling and co-ed softball, (e) textbooks and study guides.
10. Consider chip plants: potato and computer. Assume there is a large rise in the demand for computer chips and potato chips.
a How responsive to demand is each in the market period?
b Describe what a manufacturer of each product might do in the short run to increase production.
c How does the long run differ for these products?
d Draw a graph for comparison
11. If one automobile brand has an income elasticity of demand of 1.5 and another has an income elasticity equal to –0.3, what would account for the difference? Give an example of a specific brand for each type of car.
12. Suppose you estimated the cross elasticities of demand for three pairs of products and came up with the following three values: 2.3, 0.1, –1.7. What could you conclude about these three pairs of products? If you wanted to know if two products from two different firms competed with each other in the marketplace, what would you look for?
Page 132
In The News
13. In September 2015 Turing Pharmaceuticals decided to increase the price of the drug Daraprim, which is used to treat a life-threatening parasitic infection. Unlike typical price increases that never make the evening news, Turing raised the price from $13.50 per dose to $750 per dose, representing an increase of over 50 times the price. Turing’s CEO Martin Shkreli argued that the extreme price increase was justified based on market demand and the fact that the drug does save lives. How would you describe the elasticity of Daraprim? For practically any other business that chooses to raise its price by 50 times, the business would surely lose most if not all of its customers. Why is Turing still in business? How would the elasticity of Daraprim change if there were generic versions of the drug offered by other companies?
14. The market for organic and locally sourced foods has skyrocketed over the past decade as consumers focus on improving their eating habits. However, severe droughts have caused organic food prices to rise significantly, forcing many consumers to shop at conventional supermarkets (which are increasingly adding organic food options) instead of organic food markets such as Whole Foods. In response, companies such as Whole Foods have begun offering more nonorganic options on their store shelves in order to provide their consumers with more affordable options. Based on this response, what did companies such as Whole Foods realize about the elasticity of demand for organic foods that caused them to lower their prices by changing the type of foods they sell?
Solving Problems
WORK IT OUT | interactive activity
15. Rising peanut prices have forced peanut butter makers to raise the price of peanut butter from $2 to $3 per jar, causing quantity demanded to fall. In addition, sales of jelly also dropped by 15%. Soon thereafter, makers of chocolate spread dropped its price from $4 to $3 per jar. This resulted in a further decline in peanut butter sales by 20%.
a What is the cross elasticity of demand between peanut butter and jelly (use the midpoint method)? Are these two products complements or substitutes?
b What is the cross elasticity of demand between peanut butter and chocolate spread (use the midpoint method)? Are these two products complements or substitutes?
16. Suppose the demand and supply for imported wagyu beef is as shown in the figure. Now assume that the U.S. government imposes an import tax of $10 per pound on wagyu beef.
Page 133
a How does the market price change with the imposition of the $10 per pound tax?
b Do the buyers or sellers of wagyu beef bear the greater burden of the tax?
c How much tax revenue does the government collect from this market?
d Calculate the approximate value of deadweight loss created in this market from the tax.
USING THE NUMBERS
17. According to By the Numbers, how much greater is the elasticity of demand for food in Canada than in the United States? How about Mexico compared to the United States?
18. According to By the Numbers, rank the types of alternative fuel vehicles in use from the most popular to the least popular.
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Micro And Macro Segmentation About Toyota
/in Uncategorized /by developerI am researching micro and macro segmentation about toyota. Specifically the factors of toyota such as (macro) customer type and customer size and so on. The question is from a case study which is “What macro and micro segmentation factors should the company consider in developing their segmentation strategy?” the topic is about toyota
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Microbiology And The Human Health Write A Research Paper On This
/in Uncategorized /by developer1. Science writers convey complex scientificideas to the public. They must beknowledgeable in the sciences as well asproficient in techniques of journalism. Goodscience writing is thoroughly researched andcommunicates the key ideas of scientificresearch and topics in a comprehensible andstraightforward manner. Science writers arealso always on the lookout for new andinteresting discoveries and studies inscience. For this project, you are the sciencereporter for your local newspaper. You havejust received an assignment from your editor.She asks you to write an article on a majortopic within the field of microbiology. Shestipulates that in this article you must:1. Generate a historical timeline of the majorscientific discoveries leading to our currentunderstanding of the topic.2. Include a summary of our currentunderstanding of the topic.3. Project where the next major advance orbreakthrough in your topic will come from.DescriptionFor Part A of this project you explore possibletopics and do background research.Specifically, you choose a suitable topic,identify appropriate resources, and generatea brief outline of the article you will write.Your topic must fall under the followingsubheadings:1. Microbiology and human health2. Microbiology and the environment3. Microbiology and agriculture or industryProcedure 1. Consult your textbook to choose a topic under one of the subheadings listed above.For example, from the area microbiology andindustry, you might examine the use oforganisms by the alcoholic beverageindustry. More specifically, are you interestedin wine and the grapes that produce it? Youcould investigate the actions of a funguscalled “noble rot” or the cultures involved inthe fermentation of the grapes. [Need helpchoosing a topic?] 2. Email your topic to your instructor forapproval.3. Once your receive instructor approval, do some background research on your topic toget more familiar with it. Using the CredoReference and/or Britannica Online:Academic Edition databases, find 1-2articles/encyclopedia entries on your topicthat will help you complete your Project 2article. You can access these databases fromthe Library’s Background Information page. 4. Now that you have a basic understanding of your topic, find 5-6 peer-reviewed researcharticles that will help you complete yourarticle using the Library’s OneSearch tool.OneSearch is found on the Library’shomepage. Watch the OneSearch Tips videofor assistance getting started. [Note: InOneSearch you can limit your results to peerreviewed journals.] 5. You should now have a total of at least 7sources to use for your article.6. After reading the sources, think of the main points that you will cover and develop anoutline for your article. [Need help writing anoutline?] 7. In a single Word document, submit your outline and list of at least 7 sources(references) in APA format and place it in the appropriate assignment dropbox. [Need helpwith APA format?]Compose your work using a word processor(or other software as appropriate) and save itfrequently to your computer. Be sure tocheck your work and correct any spelling orgrammatical errors before you upload it.When you are ready to submit your work,click “Browse My Computer” and find yourfile. Once you have located your file, click”Open” and, if successful, the file name willappear under the Attached files heading.Scroll to the bottom of the page and click”Submit.”Your topic outline comprises 15% of the finalresearch paper project grade (2.25% of yourtotal grade). The final research papercontributes 85% of your research projectgrade (12.75% of your total grade ). Yoursubmission will be evaluated using the SLAOutline and Thesis Rubric [67 KB PDF file].Your research project grade is your outlineand your research paper combined (2.25% +12.75%) and comprises 15% of your totalgrade
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Microbiology Digestive System Case Study 2 Shelley Attends A Banquet On Her Birt
/in Uncategorized /by developerMicrobiology Digestive System Case Study# 2
Shelley attends a banquet on her birthday. They are serving a feast of seafood including oysters, claims, clam chowder, lobster cakes, and lobster. Her husband eats all the food except the lobster cakes because he is allergic to gluten. 3 hours after the banquet, Shelley begins to feel quite queasy. She has vomiting and diarrhea for the 12 hours, and then she feels relatively close to normal again.
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Microclimate Lab Report What Sources Of Error May Have Affected Your Results
/in Uncategorized /by developermicroclimate lab report
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Microeconomics Externalities Question The Demand For Gummy Bears Is Given By Q
/in Uncategorized /by developerMicroeconomics – Externalities Question
the demand for gummy bears is given by Q = 200 – 100P and these confections can be produced at a constant marginal cost of $0.50.
a. how much will sweet tooth inc be willing to pay in bribes to obtain a monopoly concession from the government for gummy bear production?
b. do the bribes represent a welfare cost from rent seeking?
c. what is the welfare cost of this rent seeking activity?
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Microeconomics A Jewelry Firm Rents Factory Space Uses Equipment And Hires Worke
/in Uncategorized /by developer$ per necklace7065T-10,00060ATCT-20,00055T-30,0005045MC105510152025303540quantity of necklaces per hourA jewelry firm rents factory space, uses equipment and hires workers to produce necklaces using a constant returns to scale production technology. The figureshows short-run average total cost (U-shaped curves) and marginal costs (increasing curves) for three different factory sizes, T=10,000, T=20,000 andT=30,000. If the firm wanted to produce 30 necklaces per hour, what size factory should it choose in the long-run?the firm could select any size
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Microeconomics Term Paper Requirementsspring 2019 Purpose The Purpose Of The Ter
/in Uncategorized /by developerMicroeconomics Term Paper Requirements
Spring 2019
Purpose: The purpose of the term paper is to expose students to the work of select early economists, and to gain additional research and writing skills.
Description: The paper should be approximately three to five pages in length, double spaced, with one inch margins. Your paper should contain the following:
Evaluation: The paper is worth 50 points.
Due Date: The class one week before the final exam.
Topic: You may choose any economist to profile. Often, less famous economists can be more interesting subjects. Possible subjects may include, but are not limited to the following:
Thomas Aquinas
Thomas Mun
Bernard Mandeville
David Hume
Francois Quesnay
Adam Smith
Thomas Robert Malthus
David Ricardo
Nassau Senior
Antoine Cournot
Karl Marx
W.S. Jevons
Carl Menger
Leon Walras
Alfred Marshall
Thorstein Veblen
Joseph Schumpeter
Frank Knight
John Stuart Mill
John Maynard Keynes
John Hicks
Paul Samuelson
Milton Friedman
Robert Lucas, Jr.
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Microeconomics Week 3 Assignmenthousing Ollapse Paperafter Reading Special Topic
/in Uncategorized /by developerMicroeconomics – Week #3 Assignment
Housing ollapse PaperAfter reading Special Topic 5, write a 2-page paper answering the followingWhy did housing prices rise rapidly during 2002 – 2005?
Why did the mortgage default rate increase so sharply during 2006 and 2007 even before the 2008 – 2009 recession began?
What did the Community Reinvestment Act have to do with the housing bubble and collapse?
Cite your sources as needed. Use APA formatting.
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Microeconomicschapter 5 Check Your Understanding1 When The Demand Curve Is Rel
/in Uncategorized /by developerMICROECONOMICS
Chapter 5 – Check Your Understanding
1. When the demand curve is relatively inelastic and the price falls, what happens to total revenue? If the demand is relatively elastic and price rises, what happens to total revenue?
2. Why is the demand for gasoline relatively inelastic, while the demand for Exxon’s gasoline is relatively elastic?
3. Describe cross elasticity of demand. Why do substitutes have positive cross elasticities? Describe income elasticity of demand. What is the difference between normal and inferior goods?
4. Describe and explain the impact of time on the price elasticity of supply. Draw graph
5. Why would the demand for business airline travel be less elastic than the demand for vacation airline travel by retirees?
6. Would an excise tax placed on cereal be more likely or less likely to be passed on to consumers than an excise tax on wireless phone and data services? Why or why not?
Apply the Concepts
7. One major rationale for farm price supports is that rapidly improving technology, better crop strains, improved fertilizer, and better farming methods increased supply so significantly that farm incomes were severely depressed. Explain how the elasticity of demand for these crops influences this rationale.
8. If the price of chicken rises by 15% and the sales of turkey breasts expand by 10%, what is the cross elasticity of demand for these two products? Are they complements or substitutes?
9. For which of the following pairs of goods or services would the cross elasticity of demand be negative? (a) Uber and Yellow Cab, (b) movie streaming subscriptions and tablets, (c) camping tents and camping permits, (d) bowling and co-ed softball, (e) textbooks and study guides.
10. Consider chip plants: potato and computer. Assume there is a large rise in the demand for computer chips and potato chips.
a How responsive to demand is each in the market period?
b Describe what a manufacturer of each product might do in the short run to increase production.
c How does the long run differ for these products?
d Draw a graph for comparison
11. If one automobile brand has an income elasticity of demand of 1.5 and another has an income elasticity equal to –0.3, what would account for the difference? Give an example of a specific brand for each type of car.
12. Suppose you estimated the cross elasticities of demand for three pairs of products and came up with the following three values: 2.3, 0.1, –1.7. What could you conclude about these three pairs of products? If you wanted to know if two products from two different firms competed with each other in the marketplace, what would you look for?
Page 132
In The News
13. In September 2015 Turing Pharmaceuticals decided to increase the price of the drug Daraprim, which is used to treat a life-threatening parasitic infection. Unlike typical price increases that never make the evening news, Turing raised the price from $13.50 per dose to $750 per dose, representing an increase of over 50 times the price. Turing’s CEO Martin Shkreli argued that the extreme price increase was justified based on market demand and the fact that the drug does save lives. How would you describe the elasticity of Daraprim? For practically any other business that chooses to raise its price by 50 times, the business would surely lose most if not all of its customers. Why is Turing still in business? How would the elasticity of Daraprim change if there were generic versions of the drug offered by other companies?
14. The market for organic and locally sourced foods has skyrocketed over the past decade as consumers focus on improving their eating habits. However, severe droughts have caused organic food prices to rise significantly, forcing many consumers to shop at conventional supermarkets (which are increasingly adding organic food options) instead of organic food markets such as Whole Foods. In response, companies such as Whole Foods have begun offering more nonorganic options on their store shelves in order to provide their consumers with more affordable options. Based on this response, what did companies such as Whole Foods realize about the elasticity of demand for organic foods that caused them to lower their prices by changing the type of foods they sell?
Solving Problems
WORK IT OUT | interactive activity
15. Rising peanut prices have forced peanut butter makers to raise the price of peanut butter from $2 to $3 per jar, causing quantity demanded to fall. In addition, sales of jelly also dropped by 15%. Soon thereafter, makers of chocolate spread dropped its price from $4 to $3 per jar. This resulted in a further decline in peanut butter sales by 20%.
a What is the cross elasticity of demand between peanut butter and jelly (use the midpoint method)? Are these two products complements or substitutes?
b What is the cross elasticity of demand between peanut butter and chocolate spread (use the midpoint method)? Are these two products complements or substitutes?
16. Suppose the demand and supply for imported wagyu beef is as shown in the figure. Now assume that the U.S. government imposes an import tax of $10 per pound on wagyu beef.
Page 133
a How does the market price change with the imposition of the $10 per pound tax?
b Do the buyers or sellers of wagyu beef bear the greater burden of the tax?
c How much tax revenue does the government collect from this market?
d Calculate the approximate value of deadweight loss created in this market from the tax.
USING THE NUMBERS
17. According to By the Numbers, how much greater is the elasticity of demand for food in Canada than in the United States? How about Mexico compared to the United States?
18. According to By the Numbers, rank the types of alternative fuel vehicles in use from the most popular to the least popular.
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Microscopy And The Metric System Ma Rga Ret E Vo Rn Da M M Ve Rsi On 4200 900001
/in Uncategorized /by developerThe compound light microscope effectively magnifies in the range of 40x to 2000x. If an object under view is 10 nm in length without any magnification, what will be its viewing size at 40x?at 2000x?What is the equivalent size at these magnifications, in inches? Show your calculations.The scanning electron microscope (SEM) employs electron bombardment to image very small specimens. Electron microscopes are used to image specimens that range from 1 nm to 100 µm in size. What is the equivalent in inches? Show your calculations.
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