An increase in the demand for notebooks raises the

Explain each of the following statements using sup-ply-and-demand diagrams. a. When a cold snap hits Florida, the price of orange juice rises in supermarkets throughout the country. b.When the weather turns warm in New England every summer, the price of hotel rooms in Caribbean resorts plummets. c.When a war breaks out in the Middle East, the price of gasoline rises and the price of a used Cadillac falls."

An increase in the demand for notebooks raises the quantity of notebooks demanded but not the quantity supplied. Is this statement true or false? Explain.

Consider the market for minivans. For each of the events listed here, identify which of the determinants of demand or supply are affected. Also indicate whether demand or supply increases or decreases. Then draw a diagram to show the effect on the price and quantity of minivans.a.People decide to have more children.b.A strike by steelworkers raises steel prices.c.Engineers develop new automated machinery for the production of minivans.d.The price of sports utility vehicles rises.e.A stock market crash lowers peoples wealth.

Consider the markets for DVDs, TV screens, and tickets at movie theaters.a.For each pair, identify whether they are complements or substitutes:DVDs and TV screens DVDs and movie ticketsTV screens and movie ticketsb.Suppose a technological advance reduces the cost of manufacturing TV screens. Draw a diagram to show what happens in the market for TV screens.c.Draw two more diagrams to show how the change in the market for TV screens affects the markets for DVDs and movie tickets.

Over the past 30 years, technological advances have reduced the cost of computer chips. How do you think this has affected the market for computers? For com-puter software? For typewriters?

Using supply-and-demand diagrams, show the effect of the following events on the market for sweatshirts.a.A hurricane in South Carolina damages the cotton crop.b.The price of leather jackets falls. c.All colleges require morning exercise in appropri-ate attire.d.New knitting machines are invented.

Ketchup is a complement (as well as a condiment) for hot dogs. If the price of hot dogs rises, what happens to the market for ketchup? For tomatoes? For tomato juice? For orange juice?

The market for pizza has the following demand and supply schedules: Price Quantity Demanded Quantity Supplied $4 135 pizzas 26 pizzas 5 104 53 6 81 81 7 68 98 8 53 110 9 39 121 a.Graph the demand and supply curves. What is the equilibrium price and quantity in this market? b.If the actual price in this market were above the equilibrium price, what would drive the market toward the equilibrium? c.If the actual price in this market were below the equilibrium price, what would drive the market toward the equilibrium?

Consider the following events: Scientists reveal that eating oranges decreases the risk of diabetes, and at the same time, farmers use a new fertilizer that makes orange trees produce more oranges. Illustrate and explain what effect these changes have on the equilibrium price and quantity of oranges.

Because bagels and cream cheese are often eaten together, they are complements.a.We observe that both the equilibrium price of cream cheese and the equilibrium quantity of bagels have risen. What could be responsible for this patterna fall in the price of flour or a fall in the price of milk? Illustrate and explain your answer.b.Suppose instead that the equilibrium price of cream cheese has risen but the equilibrium quan-tity of bagels has fallen. What could be responsible for this patterna rise in the price of flour or a rise in the price of milk? Illustrate and explain your answer.

Suppose that the price of basketball tickets at your college is determined by market forces. Currently, the demand and supply schedules are as follows: Price Quantity Demanded Quantity Supplied $4 10,000 tickets 8,000 tickets 8 8,000 8,000 12 6,000 8,000 16 4,000 8,000 20 2,000 8,000 a. Draw the demand and supply curves. What is unusual about this supply curve? Why might this be true?b.What are the equilibrium price and quantity of tickets?c.Your college plans to increase total enrollment next year by 5,000 students. The additional students will have the following demand schedule: Price Quantity Demanded $4 4,000 tickets 8 3,000 12 2,000 16 1,000 20 0 Now add the old demand schedule and the demand schedule for the new students to calculate the new demand schedule for the entire college. What will be the new equilibrium price and quantity?