Theory of supply and demand to analyze specific markets

Assignment Help Macroeconomics
Reference no: EM131376530

A key skill in economics is the ability to use the theory of supply and demand to analyze specific markets. In this week's discussion, you get a chance to demonstrate your ability to analyze the effects of several "shocks" to the market for coffee. Choose one of the three scenarios below.

Scenario 1: Suppose that, as part of an international trade agreement, the U.S. government reduces the tariff on imported coffee. Will this affect the supply or the demand for coffee? Why? Which determinant of demand or supply is being affected? Show graphically with before- and after-curves on the same axes. How will this change the equilibrium price and quantity of coffee? Explain your reasoning.

Scenario 2: Suppose the National Institutes of Health publishes a study finding that coffee drinking reduces the probability of getting colon cancer. How do you imagine this will affect the market for coffee? Why? Which determinant of demand or supply is being affected? Show graphically with before- and after-curves on the same axes. How will this change the equilibrium price and quantity of coffee? Explain your reasoning.

Scenario 3: Combine parts 1 and 2. Suppose that the U.S. government reduces the tariff on imported coffee, and a reputable study is published indicating that coffee drinkers have lower rates of colon cancer. What will the combined impact be on the equilibrium price and quantity of coffee? Explain your reasoning and show graphically. Make sure you think this through carefully!

Reference no: EM131376530

Questions Cloud

Why do managers need to understand business processes : Why do managers need to understand business processes? Can you make a correlation between systems thinking and business processes?
What question did the research attempt to answer : Read a current article on a research finding in a news magazine. You can access your article on the magazine's website if you wish. Be sure that the article is about a research finding, not just a news story about politics or current events. What ..
Customer facing processes and business facing processes : Explain the difference between customer-facing processes and business-facing processes. Which one is more important to an organization?
Calculate the allocation rate for each cost driver using abc : ACC 550- Calculate the allocation rates for each cost driver using ABC. Use the traditional costing approach to calculate the total cost and the unit cost of the stick and collapsible umbrellas.
Theory of supply and demand to analyze specific markets : A key skill in economics is the ability to use the theory of supply and demand to analyze specific markets. In this week's discussion, you get a chance to demonstrate your ability to analyze the effects of several "shocks" to the market for coffee..
Illustrated map identifying high-crime : On November 30, 1992, the student newspaper of the University of California at Berkeley illustrated a map identifying “high-crime” areas in Berkeley (see the figure attached). The 11 gray areas suffering more than 200 personal thefts and 75 burglarie..
Estimate the safety factor : The surface of the shaft fillet has been shot-peened, which is estimated to be equivalent to a laboratory mirror-polished surface. Fatigue stress concentration factors for the fillet have been determined and are shown on the drawing. Estimate the ..
How did ebusiness change traditional business models : Explain how finding different ways to travel the same road relates to automation, streamlining, and business process reengineering.
Marginal costs per unit : An assembly line can produce 60 units per hour. The line's hourly cost is $3600 on straight time (the first 8 hours). Workers are guranteed a minimum of 6 hours. There is a 50% premium for overtime and productivity for overtime drops by 5%. What a..

Reviews

Write a Review

Macroeconomics Questions & Answers

  What is the effect of a price increase on total revenue

What is demand elasticity in the $35 - $50 price range? Is demand elastic, inelastic, or of unitary elasticity Calculate the value and show all of your work. Be sure to use the midpoint equation to determine elasticity. Assume demand elasticity ..

  Why is the pure monopolist demand curve typically not

How does the demand curve faced by a purely monopolistic seller differ from that confronting a purely competitive firm? Why does it differ? Of what significant is the difference? Why is the pure monopolist demand curve typically not perfectly inelast..

  Explain which of the policies is most effective for country

Explain which of the policies is most effective for the country you researched? Provide a rationale with your answer. Discuss whether a successful market economy can develop in a non-democratic authoritarian political system. Provide examples.

  Compliance issue with the sarbanes-oxley act

"Tim told me he talked to you about the compliance issue with the Sarbanes-Oxley Act (SOX)," she says. "Your first priority is to review Apex's financial statements. Once you're familiar with our financial history, I want you to prepare a presenta..

  What is the difference between real and nominal gdp

What is the difference between real and nominal GDP? Does GDP accurately reflect the nation's welfare

  What is the process capacity in decks per hour

Assume the following average inventory in sanding, the buffer, and painting: Sanding: 1batch; Buffer: 2 batches; Painting: 1 batch. What is the average flow time from the start ofsanding until the decks are ready to enter the ..

  Explain the flow of money and goods in an economy

How economists are both scientists and policymakers and what principles society uses to allocate its scarce resources. Using the circular flow model, explain the flow of money and goods in an economy

  Method for determining the number of years

What do we call a method for determining the number of years it will take for some measure to double, given its annual percentage increase (Divide 70 by annual rate of inflation to get the number of years it will take price level to double)?

  What price will ralph receive for his bond

Ralph purchases a newly issued, two-year government bond with a principal amount of $10 000 and a coupon rate of 6% paid annually.- What price will Ralph receive for his bond?

  Advertising in oligopoly market

Using the theory of oligopoly and the concept of prisoners dilemma, explain why the cigarette companies did not cut on advertising on their own to increase their profits before the law went into effect?

  Question about cash discount

The Ogden Timber Corporation purchases from its suppliers on terms of 2/10, net 35. Ogden has not been utilizing he discount offered and has not been taking the cash discount offered and has been taking fifty days to pay its bills.

  What are the costs of inflation? which of three costs

What are the costs of inflation? Which of three costs do you think are most important for the U.S. economy?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd