demand-supply

2007-11-18 9:07 pm
Explain the following cases with a well labeled demand-supply diagram.
(a) Recently, Hygiene Department found some hazardous substances from the sample of seafood. Suppose this news raises public fear in eating seafood. With the aid of a diagram, explain the effects on the seafood’s equilibrium quantity and market price in Hong Kong.
更新1:

(b) Many publishers claimed, “The printing cost is increasing, but the total numbers of students is decreasing.” With the aid of a diagram, explain the effects on textbooks’ equilibrium quantity and market price in Hong Kong.

更新2:

(c). ‘We can increase company’s revenue by increase fares,’ said a public bus company manager. Explain with a diagram why he is correct with the concept of price elasticity of demand.

回答 (1)

2007-11-19 3:38 am
✔ 最佳答案
A) D↓ , P↑ , S constant --> Decrease in equilibrium quantity , Increase in Market price

B) S↓ (due to cost↑) , D↓ (due to no. of students↓) --> equilibrium quantity must fall, Market price depends on elasticity

C) It is correct when the elasticity of demand is inelastic, vice versa when it is elastic
參考: myself (Yr 2 Finance)


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