Label each of the following scenarios with the set of symbols that best indicate
ID: 1203667 • Letter: L
Question
Label each of the following scenarios with the set of symbols that best indicates the price change and quantity change that occur in the scenario. In some scenarios, it may not be possible from the information given to determine the direction of a particular price change or a particular quantity change. We will symbolize those cases as, respectively, “P?” and “Q?” The four possible combinations of price and quantity changes are:. LO3.5
P Q? P? Q
P Q? P?Q
On a hot day, both the demand for lemondae and the supply of lemonade increase.
On a cold day, both the demand for ice cream and the supply of ice cream decrease.
When Hawaii’s Mt. Kilauea erupts violently, the demand on the part of tourists for sigtseeing flights increases but the supply of pilots willing to provide these dangerous flights decreases.
In a hot area of Arizona where they generate a lot of their electicity with wind turbines, the demand for the electricity falls on windy days as people switch off their air conditioners and enjoy the breeze. But at the same time, the amount of electricity supplied increases as the wind turbines spin faster.
Explanation / Answer
A) On a hot day , prices will go accordingly to the demand and supplu .If supply is high the prices will be low and quantity will be more .
b)On a cold day , the prices can decrease but quantity may or may not fall ? because the demand falls so people would pay less ffor ice cream .
c) due to fall in supply of flights , the price will rise and the quantity i.e no of flights will be low .
d) Prices will be lower due to more electricity generation i.e. more quantity of electricity is generated .
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