Answered: EXPLAIN WHY THE PRICE ELASTICITY OF…

EXPLAIN WHY THE PRICE ELASTICITY OF SUPPLY IS LARGER: FOR FIRMS THAT CAN STORE INVENTORIES Full explain this question and text typing work only thanks

Essentials of Economics (MindTap Course List)

8th Edition

ISBN:9781337091992

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter5: Elastic And Its Application

Section: Chapter Questions

Problem 7QR: How is the price elasticity of supply calculated? Explain what it measures.

See similar textbooks

Related questions

Q: Assume consumption is represented by the following function: C=400+0.75Y. Also assume that planned…

A: In a closed economy without government, aggregate expenditure is the sum of consumption and…

Q: 5. A manufacturer has been shipping his product (moderately heavy machines), mounted only on skids…

A: A cost is the value of the money that has been spent to make something or give a service and is thus…

Q: According to the vacancy supply condition, firms keep opening vacancies until the cost of opening a…

A: Firms open vacanies in a job when the need to hire more human resources. These vacancies are filled…

Q: The figure below displays 6 different bundles of Good #1 and Good #2. Bundles A, B, C, D, and E are…

A: We have initial prices p1=p2=1 and the consumer income =y=$20 and then price of good-1 increased to…

Q: Q^d= 9.5 - 2p Q^s= 0.6p 1. Competitive Equilibrium. In this question you solve for the competitive…

A: Q^d=9.5 - 2p Q^s=0.6p (A) Calculation for equilibrium price and quantity:- We can set the demand and…

Q: relationship In the Mortensen-Pissarides model the wage-setting curve gives a between the real wage…

A: In the Mortensen-Pissarides labor market environment model the main elements: are flows between…

Q: What is the Neoclassical Economics view of labor markets. How do they function? Does the economy…

A: Labor Markets are defined as the economic arrangement where businesses engaged in production of…

Q: Monopolistic competition is characterized by (Select all correct answers) □ A. Easy entry and exit…

A: There are different types of market structures on the basis of number of buyers and sellers, type of…

Q: Question 2: Consider the production function given by Y = min(L,5K). The firm has a fixed amount of…

A: The production function represents the relationship between the output and inputs. The function is…

Q: Marginal product measures the change in: Group of answer choices a firm's revenue brought about by…

A: Total product is the total output produced by employing the labor/ input. Average product is the…

Q: Superior Trading Co. operates in a competitive market, and decides which price to charge their…

A: A market structure with large buyers and sellers is called perfect competition. The market structure…

Q: Assume a demand curve for coffee; Which of the following would NOT shift the demand curve for…

A: Shift in demand is associated with the change in components of demand other than price. When there…

Q: Given the following demand equation: Qxd=68-0.8Px + 0.005M+ 1.7Py - 3.4Pz; where: Qxd is quantity…

A: When goods are complement , the increase in price of one good will decrease the quantity demanded of…

Q: In the year 2019, a corporation made $18.8 Million in revenue, $2.2 Million of operating expenses,…

A: Revenue = 18.8 million Operating Expenses = 2.2 million State Tax Rate = 11% Fed Tax Rate = 21%

Q: 8. Figure below shows the Percentage of Total National Income Spent on Health Care in the United…

A: A value of a variable as a percentage of the value of the other variable is given as: = (value…

Q: ? V 1. Promote ? V 2. Reduce

A: The long term economic growth increases when the productivity of the economy increases or real GDP…

Q: A polling company reported that 53% of 2286 surveyed adults said that they play football. Complete…

A: Actual value can be derived from the percentage as follows Actual value = Value × Percentage of…

Q: 1. Open market operations as a monetary tool Suppose that the Federal Reserve buys $6 million worth…

A: When the Federal Reserve buys 6 million dollars government securities from a consumer then its…

Q: • point of diminishing returns (D) most productive point (P) economic capacity (E) Once a point is…

A: No of Workers TP 1 10 2 80 3 180 4 240 5 280 6 294 Variable Cost = 220 per day Fixed…

Q: Labor productivity is the term used for Select one: a. None of the answers are correct b. Total…

A: Real output per work hour, which is the unit used to determine labour productivity, is how growth in…

Q: A manufacturer has been selling 1050 television sets a week at $540 each. A market survey indicates…

Q: Country A has 6 million workers and Country B has 9 million workers. Each worker in Country A can…

A: Country A has 6 million workers and Country B has 9 million workers. Each worker produces:…

Q: Bob and Billy each invest $1,000,000 and $1200, respectively, in their own account with the same…

A: In an economy, an investment is the buying of products that are not consumed today but are used in…

Q: Redo the problem in Question 2 under the assumption that the person can buy flood insurance at a…

A: Contingent consumption refers to the consumption of the buyer when there are uncertain conditions.…

Q: National income accounting deals with the aggregate measure of the outcome of economic activities.…

A: The final worth of all the products and services generated in an economy during a specific time…

Q: Consider a market where the price of elasticity of the demand for streaming services is -0.6, the…

A: Income elasticity of demand: Income elasticity of demand for a good refers to the percentage change…

Q: Suppose that demand and supply of apples are described by the following equations: P = 100 - 3Q…

A: The quantity demanded is the number of units of the commodities that customers have ordered at a…

Q: What is market equilibrium and does market equilibrium matter?

A: Disequilibrium macroeconomics is a habit of research focused on the role of disequilibrium in…

Q: un equilibrium, a monopolistically competitive producer achi

A: monopolistically competitive market, the sellers sell differentiated produces which are close…

Q: O Calculate the elasticity of demand at a price of $9. Elasticity = (Round to three decimal places.)…

A: Elasticity of demand refers to responsiveness of quantity demand with respect to change in price…

Q: Q^d= 9.5 - 2p Q^s= 0.6p Tax. Suppose that the government imposes a tax equal to T = 0.50 which must…

A: Since you have posted a question with multiple sub parts, we will solve first three subparts for…

Q: The major assets on a bank's balance sheet are its checking and savings account deposits. loans, and…

A: Balance sheet is the T account showing the assets and liabilities of a firm. Balance sheet shows…

Q: countries that have experienced hyperinflation, what role have large government budget deficits…

A: Hyperinflation is a situation where the prices in the economy rise at a very high rate and generally…

Q: industry Market Share of Firms in Industry 4 5 6

A: The concentration ratio indicates whether an industry is comprised of a few large firms or many…

Q: You have collected data for the 50 U.S. states and estimated the following relationship between the…

A: The unemployment rate means the percentage of people in the labor force who are unemployed.…

Q: Refer to the information provided in Table 1 below to answer the questions that follow. Aggregate…

A: Aggregate consumption decides aggregate saving because saving is characterized as the piece of…

Q: A parent wishes to develop an educational fund for a new born child's college education. The fund is…

A: Introduction: It is given that equal withdrawal is made on the 18th, 19th, 20th, and 21st birthdays.…

Q: For the demand function p= 40 - 5x², match each of the points (0, 40) and (8,0) with statement (a)…

A: The given demand functions has two coordinates which indicates the quantity and price (q,p) . as we…

Q: In building their plant, the officers of the International Leather Company had the choice…

A: The present worth or PW method is quite famous in industry because all future costs and revenues are…

Q: 6.1. Suppose the demand schedule for CDs is as follows: (marks:10) Price ($) QD of CDs 10 12 300 270…

A: A good's price elasticity of demand is a measure of how sensitive the quantity demanded is to its…

Q: The table below shows cost data for producing different amounts of cough syrup. Use the given…

A: Total cost is the sum of fixed cost and variable cost Fixed cost remain fixed for all level of…

Q: The owners if a small manufacturing concern have hired a vice president to tun the company with the…

A: compensation of VP = Salary + 0..75 of 1,50,000 + 10% of 150,000 The purchase price is 4.5 times of…

Q: Suppose that the market for milk can be represented by the following equations: Demand: P = 12 –…

A: The number of units of the commodities that consumers have requested at a specific price over a…

Q: Which of the following was a way for the b ureauof labor statistics to reduce the qualitty/new good…

A: Inflation refers to increase in the general price level. A inflation rate is worrisome for the…

Q: Suppose there are a negative demand shock and a positive supply shock in a perfectly competitive…

A: Equilibrium in the market is defined as a situation in which the quantity demanded of the good is…

Q: There are a variety of taxes that a person pays when buying an airline ticket. One tax is called the…

A: Passengers no doubt pay an array of taxes and as mentioned one such is the LUST taxes. When…

Q: $2,140 Evan's Hat Store sells hats in a perfectly competitive market with a downward sloping demand…

Q: Firm A produces 300 saucepans and the Marginal Cost of the 300th unit is $160 while the Marginal…

A: A given that firm is producing 300 units with marginal cost of 160 and marginal revenue is 600 of…

Q: Given the demand function D(p) = 200 – 3p², Find the Elasticity of Demand at a price of $5 At this…

A: An elasticity of demand determines how sensitive the quantity demanded will be to the price. It will…

Concept explainers

Normal and Inferior Goods

Understanding a normal good and an inferior good is important because it tells us what will happen to demand different products during booms and recessions.

Question

Question 1

EXPLAIN WHY THE PRICE ELASTICITY OF SUPPLY IS LARGER: FOR FIRMS THAT CAN STORE INVENTORIES

Full explain this question and text typing work only thanks

Video Video

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Introduction

VIEW

Explanation

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

What is the difference between the demand and the quantity demanded of a product, say milk? Explain in words and show the difference on a graph with a demand curve for milk.
The quantity supplied of a good rises from 120 to 140 as price rises from 4 to 5.50. What is the price elasticity of supply of the good?
The equation for a demand curve is P=2/Q. What is the elasticity of demand as price falls from 5 to 4? What is the elasticity of demand as the price falls from 9 to 8? Would you expect these answers to be the same?
Jills Sausage Dog Stand projects the following demand for Jills sausage dogs: a. Calculate the price elasticity of demand between 2 and 4. Is demand in this range elastic or inelastic? b. Calculate the price elasticity of demand between 4 and 6. Is demand in this range elastic or inelastic?
The avenge annual income rises from 25,000 to 33,000, and the quantity of bleed consumed in a year by the avenge person falls from 30 loaves to 22 loaves. What is the income elasticity of bread consumption? Is bread a normal or an inferior good?
Define the price elasticity of demand. Explain the relationship between total revenue and the price elasticity of demand.
Over time, technological advance increases consumers incomes and reduces the price of smartphones. Each of these forces increases the amount consumers spend on smartphones if the income elasticity of demand is greater tha____________ and if the price elasticity of demand is greater than_____________. a. zero, zero b. zero, one c. one. zero d. one, one
Would you expect supply to play a more significant role in determining the price of a basic necessity like food or a luxury like perfume? Explain. Hint: Think about how the price elasticity of demand will differ between necessities and luxuries.
What is the price elasticity of demand? Can you explain it in your own words?
What are the equilibrium price and quantity of sweet packs? If sweets were 50 cents a bag, describe the situation in the market for sweets and explain what would happen to the price of a pack of sweets. Use the above data to draw a graph with the cocrrect labelling. Explain what is price elasticity of demand and why it would be important for producers to know the price of elasticity of their product and how would it affect their decision making?
6T Demand for Milk in Smalltown IISA Fill in the Blank Question Refer to the graph as shown. If the price of milk is $2 per gallon, then th consumers would be willing to purchase gall of milk per day. (Enter a number in the blank.) Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.
Name WHAT IS ELASTICITY OF SUPPLY?, CONTINUED APPLICATION Mark It Up! Millions of metric tons 120 110 100 90 80 70 60 50 40 30 20 10 0 Steel and Steel Products Produced in the United States 2000 2001 2002 Key 2003 Steel Steel products Source: U.S. Geological Surve y Minerals Yearbook Date 7. Reread your notes on "What Affects Elasticity of Supply." On the bar graph, label the raw material. On the line below, list some examples of products the bar graph could include. 8. How did the supply of raw material and the supply of finished products change over the years shown in the bar graph? 9. Explain two ways the supplies of the two items shown on the bar graph could be interrelated.