Reference no: EM131309306

Illustrate the following with supply and demand curves:

a. With increased access to wireless technology and lighter weight, the demand for laptop computers has increased substantially. Laptops have also become easier and cheaper to produce as new technology has come online. Despite the shift of demand, prices have fallen.

b. Cranberry production in Massachusetts totaled 2.37 million barrels in 2008, a 56 percent increase from the 1.52 million barrels produced in 2007. Demand increased by even more than supply, pushing 2008 prices to $56.70 per barrel from $49.80 in 2007.

c. During the high-tech boom in the late 1990s, San Jose office space was in very high demand and rents were very high. With the national recession that began in March 2001, however, the market for office space in San Jose (Silicon Valley) was hit very hard, with rents per square foot falling. In 2005, the employment numbers from San Jose were rising slowly and rents began to rise again. Assume for simplicity that no new office space was built during the period.

d. Before economic reforms were implemented in the countries of Eastern Europe, regulation held the price of bread substantially below equilibrium. When reforms were implemented, prices were deregulated and the price of bread rose dramatically. As a result, the quantity of bread demanded fell and the quantity of bread supplied rose sharply.

e. The steel industry has been lobbying for high taxes on imported steel. Russia, Brazil, and Japan have been producing and selling steel on world markets at $610 per metric ton, well below what equilibrium would be in the United States with no imports. If no imported steel was permitted into the country, the equilibrium price would be $970 per metric ton. Show supply and demand curves for the United States, assuming no imports; then show what the graph would look like if U.S. buyers could purchase all the steel that they wanted from world markets at $610 per metric ton; show the quantity of imported steel.