Reference no: EM131424636
For parts a through d of this problem, state whether demand or supply will change (only one will change in each case). State whether the equilibrium price and quantity will rise or fall in the indicated market as a result of each change described. Demonstrate each answer with a graph using supply-and-demand graphical analysis. Briefly explain each answer. Follow the separate instructions for part e.
a. After watching the Olympic track and field events, home viewers are inspired to start training programs to compete in local road races. Determine the impact on the fitness-club market.
b. Trump organization (Several hotel chains) build new hotels in the downtown area of Washington D.C. Determine the impact on the hotel market for Washington D.C.
c. As a result of the plenty rainfall in California, orange farmers have a much larger yield than usual. Determine the impact on the market for oranges.
d. Consumers purchase a small number of electric cars and more sports-utility vehicles. Determine the impact on the market for retail gasoline.
e. For this part of the problem, consider two changes impacting the market for fast-food hamburgers. Suppose that a new study shows that hamburger consumption increases the risk of heart disease to a much greater extent than previously thought. At the same time, suppose that the cost to hamburger suppliers has increased due expensive new government regulations for food processing. Which of these changes will impact the supply and which will impact the demand in this market for fast-food hamburgers? Without any further information, can we predict the direction of change in equilibrium quantity? Without any further information, can we predict the direction of change in equilibrium price? Demonstrate your answer graphically using supply-and-demand analysis and briefly explain your answer.
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