Homework Sourse1 The demand and supply schedules for hot dogs are Quantity
1. The demand and supply schedules for hot dogs are:
Quantity demanded
(millions per week)
Quantity supplied
(millions per week)
a. What are the equilibrium price and equilibrium quantity of hot dogs?
b. If the price for hot dogs were 90 cents, describe the situation in the market for hot dogs and explain what would happen next in the market.
c. Assume a new breed of “lipless” pigs is bred, resulting in a decrease in supply of 40 million hot dogs per week. What is the new equilibrium price and quantity in the market?
d. Assume that, at the same time that part c. occurs, a Canadian news magazine prints a story regarding the cancer-reducing effects of hot dog consumption. The result is an increase to demand of 20 million hot dogs per week. What is the new equilibrium price and quantity in the market?
| Price | Quantity demanded (millions per week) | Quantity supplied (millions per week) |
| 40 | 170 | 90 |
| 50 | 160 | 100 |
| 60 | 150 | 110 |
| 70 | 140 | 120 |
| 80 | 130 | 130 |
| 90 | 120 | 140 |
| 100 | 110 | 150 |
| 110 | 100 | 160 |
Solution
Answer:- The equilibrium price :- 80
The equilibrium quantity of hot dogs:- 130
When the price is 90 cents, supply of hot dogs will be 140 and quantity demanded is 120 thus there is a surplus of hotdogs of 140-120 =20 hot dogs in the market and thus the price will reduce.
Price
Quantity demanded
(millions per week)
New Quantity supplied
(millions per week)
40
170
90-40 =50
50
160
100-40=60
60
150
110-40=70
70
140
120-40=80
80
130
130-40=90
90
120
140-40=100
100
110
150-40=110
110
100
160-40=120
The new equilibrium quantity will be 110 units and price will be 100 cents.
Assume that, at the same time that part c. occurs, a Canadian news magazine prints a story regarding the cancer-reducing effects of hot dog consumption. The result is an increase to demand of 20 million hot dogs per week. What is the new equilibrium price and quantity in the market?
Price
Quantity demanded
(millions per week)
New Quantity supplied
(millions per week)
40
170+20 =190
90-40 =50
50
160+20 =180
100-40=60
60
150+20 =170
110-40=70
70
140+20 =160
120-40=80
80
130+20 =150
130-40=90
90
120+20 =140
140-40=100
100
110+20 =130
150-40=110
110
100+20 =120
160-40=120
The new equilibrium quantity will be 120 units and price will be 110 cents
I REQUEST YOU TO KINDLY RATE THE ANSWER AS THUMBS UP. THANKS A LOT
| Price | Quantity demanded (millions per week) | New Quantity supplied (millions per week) |
| 40 | 170 | 90-40 =50 |
| 50 | 160 | 100-40=60 |
| 60 | 150 | 110-40=70 |
| 70 | 140 | 120-40=80 |
| 80 | 130 | 130-40=90 |
| 90 | 120 | 140-40=100 |
| 100 | 110 | 150-40=110 |
| 110 | 100 | 160-40=120 |
