Answer to Question #305091 in Microeconomics for M.kabeer

Question

11. Let's call the original demand curve (from Question 4) D1 and the new demand curve (from Questions 6-10) D2. Plot both of the demand curves on the graph above. Use the formulas for the two demand curves to compute the quantity demanded shown by each curve at a price of 34. 12. Demand Curve D1: Price: 34, Quantity: 13. Demand Curve D2: Price: 34, Quantity: 14. Describe what has happened to demand in this problem.

Answer 1

11.)

12.)

Demand Curve D1: At a Price of $34, the quantity demanded is;

Q= about 21

13.)

Demand Curve D2: At a Price of $34, the quantity demanded is;

Q= about 7.2

14.)

Based on the two demand curves it appears like the demand increases. For the same price to the consumer of ($34), the quantity is seen to have decreased significantly from a quantity of about 21 to a quantity of about 7.