平狄克和鲁宾费尔德微观经济学microeconomics-rubinfeld-pindyck--te

Chapter2:TheBasicsofSupplyandDemand5CHAPTER2THEBASICSOFSUPPLYANDDEMANDQUESTIONSFORREVIEW1.Supposethatunusuallyhotweathercausesthedemandcurveforicecreamtoshifttotheright.Whywillthepriceoficecreamrisetoanewmarket-clearinglevel?Assumethesupplycurveisfixed.Theunusuallyhotweatherwillcausearightwardshiftinthedemandcurve,creatingshort-runexcessdemandatthecurrentprice.Consumerswillbegintobidagainsteachotherfortheicecream,puttingupwardpressureontheprice.Thepriceoficecreamwillriseuntilthequantitydemandedandthequantitysuppliedareequal.D1D2P1P2SPriceQuantityofIceCreamQ1=Q2Figure2.12.Usesupplyanddemandcurvestoillustratehoweachofthefollowingeventswouldaffectthepriceofbutterandthequantityofbutterboughtandsold:a.Anincreaseinthepriceofmargarine.Mostpeopleconsiderbutterandmargarinetobesubstitutegoods.Anincreaseinthepriceofmargarinewillcausepeopletoincreasetheirconsumptionofbutter,therebyshiftingthedemandcurveforbutteroutfromD1toD2inFigure2.2.a.ThisshiftindemandwillcausetheequilibriumpricetorisefromP1toP2andtheequilibriumquantitytoincreasefromQ1toQ2.Chapter2:TheBasicsofSupplyandDemand6D1D2P1P2SPriceQuantityofButterQ1Q2Figure2.2.ab.Anincreaseinthepriceofmilk.Milkisthemainingredientinbutter.Anincreaseinthepriceofmilkwillincreasethecostofproducingbutter.ThesupplycurveforbutterwillshiftfromS1toS2inFigure2.2.b,resultinginahigherequilibriumprice,P2,coveringthehigherproductioncosts,andalowerequilibriumquantity,Q2.DP1P2S2PriceQuantityofButterQ1Q2S1Figure2.2.bNote:Giventhatbutterisinfactmadefromthefatthatisskimmedoffofthemilk,butterandmilkarejointproducts.Ifyouareawareofthisrelationship,thenyouranswerwillchange.Inthiscase,asthepriceofmilkincreases,sodoesthequantitysupplied.Asthequantitysuppliedofmilkincreases,thereisalargersupplyoffatavailabletomakebutter.Thiswillshiftthesupplyofbuttercurvetotherightandthepriceofbutterwillfall.Chapter2:TheBasicsofSupplyandDemand7c.Adecreaseinaverageincomelevels.Assumethatbutterisanormalgood.AdecreaseintheaverageincomelevelwillcausethedemandcurveforbuttertoshiftfromD1toD2.ThiswillresultinadeclineintheequilibriumpricefromP1toP2,andadeclineintheequilibriumquantityfromQ1toQ2.SeeFigure2.2.c.D1P1P2SPriceQuantityofButterQ1Q2D2Figure2.2.c3.Ifa3-percentincreaseinthepriceofcornflakescausesa6-percentdeclineinthequantitydemanded,whatistheelasticityofdemand?Theelasticityofdemandisthepercentagechangeinthequantitydemandeddividedbythepercentagechangeintheprice.Theelasticityofdemandforcornflakesis632.Thisisequivalenttosayingthata1%increaseinpriceleadstoa2%decreaseinquantitydemanded.Thisisintheelasticregionofthedemandcurve,wheretheelasticityofdemandexceeds-1.0.4.Explainthedifferencebetweenashiftinthesupplycurveandamovementalongthesupplycurve.Amovementalongthesupplycurveiscausedbyachangeinthepriceorthequantityofthegood,sincethesearethevariablesontheaxes.Ashiftofthesupplycurveiscausedbyanyotherrelevantvariablethatcausesachangeinthequantitysuppliedatanygivenprice.Someexamplesarechangesinproductioncostsandanincreaseinthenumberoffirmssupplyingtheproduct.5.Explainwhyformanygoods,thelong-runpriceelasticityofsupplyislargerthantheshort-runelasticity.Theelasticityofsupplyisthepercentagechangeinthequantitysupplieddividedbythepercentagechangeinprice.Anincreaseinpriceinducesanincreaseinthequantitysuppliedbyfirms.Somefirmsinsomemarketsmayrespondquicklyandcheaplytopricechanges.However,otherfirmsmaybeconstrainedbytheirproductioncapacityintheshortrun.Thefirmswithshort-runcapacityconstraintswillhaveashort-runsupplyelasticitythatislesselastic.However,inthelongrunallfirmscanincreasetheirscaleofproductionandthushavealargerlong-runpriceelasticity.Chapter2:TheBasicsofSupplyandDemand86.Whydolong-runelasticitiesofdemanddifferfromshort-runelasticities?Considertwogoods:papertowelsandtelevisions.Whichisadurablegood?Wouldyouexpectthepriceelasticityofdemandforpapertowelstobelargerintheshort-runorinthelong-run?Why?Whataboutthepriceelasticityofdemandfortelevisions?Long-runandshort-runelasticitiesdifferbasedonhowrapidlyconsumersrespondtopricechangesandhowmanysubstitutesareavailable.Ifthepriceofpapertowels,anon-durablegood,weretoincrease,consumersmightreactonlyminimallyintheshortrun.Inthelongrun,however,demandforpapertowelswouldbemoreelasticasnewsubstitutesenteredthemarket(suchasspongesorkitchentowels).Incontrast,thequantitydemandedofdurablegoods,suchastelevisions,mightchangedramaticallyintheshortrunfollowingapricechange.Forexample,theinitialresultofapriceincreasefortelevisionswouldcauseconsumerstodelaypurchasesbecausedurablegoodsarebuilttolastlonger.Eventuallyconsumersmustreplacetheirtelevisionsastheywearoutorbecomeobsolete,andtherefore,weexpectthedemandfordurablestobemoreinelasticinthelongrun.7.Arethefollowingstatementstrueorfalse?Explainyouranswer.a.Theelasticityofdemandisthesameastheslopeofthedemandcurve.False.Elasticityofdemandisthepercentagechangeinquantitydemandedforagivenpercentagechangeinthepriceoftheproduct.Theslopeofthedemandcurveisthechangeinpriceforagivenchangeinquantitydemanded,measuredinunitsofoutput.Thoughsimilarindefinition,theunit