微觀經(jīng)濟(jì)學(xué)（平狄克、魯賓費(fèi)爾德）第六版課后答案--微觀經(jīng)濟(jì)學(xué)英文原版--CH02_PINDYCK

1、Chapter 2The Basics of Supplyand Demand2005 Pearson Education, Inc.1IntroductionWhat are supply and demand?What is the market mechanism?What are the effects of changes in market equilibrium?What are elasticities of supply and demand?2005 Pearson Education, Inc.2Topics to Be Discussed How do short-ru

2、n and long-run elasticities differ?How do we understand and predict the effects of changing market conditions?What are the effects of government intervention price controls?2005 Pearson Education, Inc.3Supply and DemandSupply and demand analysis can:Help us understand and predict how real world econ

3、omic conditions affect market price and productionAnalyze the impact of government price controls, minimum wages, price supports, and production incentives on the economyDetermine how taxes, subsidies, tariffs and import quotas affect consumers and producers2005 Pearson Education, Inc.4Supply and De

4、mandThe Supply CurveThe relationship between the quantity of a good that producers are willing to sell and the price of the goodMeasures quantity on the x-axis and price on the y-axis2005 Pearson Education, Inc.5The Supply CurveSThe supply curve slopesupward, demonstrating thatat higher prices firms

5、will increase outputThe Supply Curve, Graphically DepictedQuantity Price($ per unit) P1Q1P2Q22005 Pearson Education, Inc.6The Supply CurveOther Variables Affecting SupplyCosts of ProductionLaborCapitalRaw Materials Lower costs of production allow a firm to produce more at each price and vice versa20

6、05 Pearson Education, Inc.7Change in SupplyThe cost of raw materials fallsProduced Q1 at P1 and Q0 at P2Now produce Q2 at P1 and Q1 at P2Supply curve shifts right to SPSQP1P2Q1Q0SQ22005 Pearson Education, Inc.8The Supply CurveChange in Quantity SuppliedMovement along the curve caused by a change in

7、priceChange in SupplyShift of the curve caused by a change in something other than the price of the goodChange in costs of production2005 Pearson Education, Inc.9Supply and DemandThe Demand CurveThe relationship between the quantity of a good that consumers are willing to buy and the price of the go

8、odMeasures quantity on the x-axis and price on the y-axis2005 Pearson Education, Inc.10The Demand CurveDThe demand curve slopesdownward, demonstrating that consumers are willingto buy more at a lower priceas the product becomes relatively cheaper.Quantity Price($ per unit)P2Q1P1Q22005 Pearson Educat

9、ion, Inc.11The Demand CurveOther Variables Affecting DemandIncomeIncreases in income allow consumers to purchase more at all pricesConsumer TastesPrice of Related GoodsSubstitutesComplements2005 Pearson Education, Inc.12DPQDQ1P2Q0P1Q2Change in DemandIncome IncreasesPurchased Q0, at P2 and Q1 at P1No

10、w purchased Q1 at P2 and Q2 at P1Same for all pricesDemand curve shifts right2005 Pearson Education, Inc.13The Demand CurveChanges in quantity demandedMovements along the demand curve caused by a change in priceChanges in demand A shift of the entire demand curve caused by something other than price

11、IncomePreferences2005 Pearson Education, Inc.14The Market MechanismThe market mechanism is the tendency in a free market for price to change until the market clearsMarkets clear when quantity demanded equals quantity supplied at the prevailing priceMarket clearing price price at which markets clear2

12、005 Pearson Education, Inc.15The Market MechanismDSThe curves intersect atequilibrium, or market-clearing, price. Quantity demanded equals quantity supplied at P0P0Q0Quantity Price($ per unit)2005 Pearson Education, Inc.16The Market MechanismIn equilibriumThere is no shortage or excess demandThere i

13、s no surplus or excess supplyQuantity supplied equals quantity demandedAnyone who wants to buy at the current price can and all producers who want to sell at that price can2005 Pearson Education, Inc.17Market Surplus1The market price is above equilibriumThere is excess supply - surplusDownward press

14、ure on priceQuantity demanded increases and quantity supplied decreasesThe market adjusts until new equilibrium is reached2005 Pearson Education, Inc.18The Market MechanismDSP0Q0At P1, price is above the market clearing priceQs QDPrice falls to the market-clearing priceMarket adjusts to equilibriumP

15、1SurplusQuantity Price($ per unit)QSQD2005 Pearson Education, Inc.19The Market MechanismThe market price is below equilibrium:There is excess demand - shortageUpward pressure on pricesQuantity demanded decreases and quantity supplied increasesThe market adjusts until the new equilibrium is reached20

16、05 Pearson Education, Inc.20The Market MechanismDSQSQDP2Quantity Price($ per unit)At P2, price is below the market clearing priceQD QSPrice rises to the market-clearing priceMarket adjusts to equilibriumQ3P3Shortage2005 Pearson Education, Inc.21The Market MechanismSupply and demand interact to deter

17、mine the market-clearing priceWhen not in equilibrium, the market will adjust to alleviate a shortage or surplus and return the market to equilibriumMarkets must be competitive for the mechanism to be efficient2005 Pearson Education, Inc.22Changes in Market EquilibriumEquilibrium prices are determin

18、ed by the relative level of supply and demandChanges in supply and/or demand will cause change in the equilibrium price and/or quantity in a free market2005 Pearson Education, Inc.23SChanges in Market EquilibriumRaw material prices fallS shifts to SSurplus at P1 between Q1, Q2Price adjusts to equili

19、brium at P3, Q3 PQSDP3Q3Q1P1Q22005 Pearson Education, Inc.24DSDQ3P3Changes in Market EquilibriumIncome IncreasesDemand increases to DShortage at P1 of Q1 to Q2Equilibrium at P3 and Q3 PQQ1P1Q22005 Pearson Education, Inc.25DSChanges in Market EquilibriumIncome increases and raw material prices fallQu

20、antity increasesIf the increase in D is greater than the increase in S price also increases PQSP2Q2DP1Q12005 Pearson Education, Inc.26Shifts in Supply and DemandWhen supply and demand change simultaneously, the impact on the equilibrium price and quantity is determined by:The relative size and direc

21、tion of the changeThe shape of the supply and demand models2005 Pearson Education, Inc.27The Price of a College EducationThe real price of a college education rose 55 percent from 1970 to 2002Increases in costs of modern classrooms and wages increased costs of production decrease in supplyDue to a l

22、arger percentage of high school graduates attending college, demand increased2005 Pearson Education, Inc.28Market for a College EducationQ (millions enrolled) P(annual costin 1970dollars) D1970S1970S2002D2002$3,91713.2New equilibriumwas reached at $4,573 and a quantity of 12.3 million students$2,530

23、8.62005 Pearson Education, Inc.29The Long-Run Behaviorof Natural Resource PricesConsumption of copper has increased about a hundredfold from 1880 through 2002The long term real price for copper has remained relatively constantIncreased demand as world economy grewDecreased production costs increased

24、 supply2005 Pearson Education, Inc.30S2002D2002D1900S1900S1950D1950Long-Run Path ofPrice and ConsumptionResource Market EquilibriumQuantity Price2005 Pearson Education, Inc.31Resource MarketConclusionDecreases in the costs of production have increased the supply by more than enough to offset the inc

25、rease in demand2005 Pearson Education, Inc.32Elasticities of Supply and DemandNot only are we concerned with what direction price and quantity will move when the market changes, but we are concerned about how much they changeElasticity gives a way to measure by how much a variable will change with t

26、he change in another variableSpecifically, it gives the percentage change in one variable resulting from a one percent change in another2005 Pearson Education, Inc.33Price Elasticity of DemandMeasures the sensitivity of quantity demanded to price changesIt measures the percentage change in the quant

27、ity demanded of a good that results from a one percent change in price2005 Pearson Education, Inc.34Price Elasticity of DemandThe percentage change in a variable is the absolute change in the variable divided by the original level of the variableTherefore, elasticity can also be written as:2005 Pear

28、son Education, Inc.35Price Elasticity of DemandUsually a negative numberAs price increases, quantity decreasesAs price decreases, quantity increasesWhen |EP| 1, the good is price elastic|%Q| |%P|When |EP| 1, the good is price inelastic|%Q| |% P|2005 Pearson Education, Inc.36Price Elasticity of Deman

29、dThe primary determinant of price elasticity of demand is the availability of substitutesMany substitutes, demand is price elasticCan easily move to another good with price increasesFew substitutes, demand is price inelastic2005 Pearson Education, Inc.37Price Elasticity of DemandLooking at a linear

30、demand curve, as we move along the curve Q/P is constant, but P and Q will changePrice elasticity of demand must therefore be measured at a particular point on the demand curveElasticity will change along the demand curve in a particular way2005 Pearson Education, Inc.38Price Elasticity of DemandGiv

31、en a linear demand curveElasticity depends on slope and on the values of P and QThe top portion of demand curve is elastic Price is high and quantity smallThe bottom portion of demand curve is inelasticPrice is low and quantity high2005 Pearson Education, Inc.39Price Elasticity of DemandQPrice4824Ep

32、 = -1Ep = 0EP = -ElasticInelasticDemand CurveQ = 8 2P2005 Pearson Education, Inc.40Price Elasticity of DemandThe steeper the demand curve, the more inelastic the demand for the good becomesThe flatter the demand curve, the more elastic the the demand for the good becomesTwo extreme cases of demand c

33、urvesCompletely inelastic demand verticalInfinitely elastic demand horizontal2005 Pearson Education, Inc.41Infinitely Elastic DemandDP*Quantity PriceEP = 2005 Pearson Education, Inc.42Completely Inelastic DemandQuantity PriceQ*DEP = 02005 Pearson Education, Inc.43Other Demand ElasticitiesIncome Elas

34、ticity of DemandMeasures how much quantity demanded changes with a change in income2005 Pearson Education, Inc.44Other Demand ElasticitiesCross-Price Elasticity of DemandMeasures the percentage change in the quantity demanded of one good that results from a one percent change in the price of another

35、 good2005 Pearson Education, Inc.45Other Demand ElasticitiesComplements: Cars and TiresCross-price elasticity of demand is negativePrice of cars increases, quantity demanded of tires decreasesSubstitutes: Butter and MargarineCross-price elasticity of demand is positivePrice of butter increases, quan

36、tity of margarine demanded increases2005 Pearson Education, Inc.46Price Elasticity of SupplyMeasures the sensitivity of quantity supplied given a change in priceMeasures the percentage change in quantity supplied resulting from a 1 percent change in price2005 Pearson Education, Inc.47Point vs. Arc E

37、lasticitiesPoint elasticity of demandPrice elasticity of demand at a particular point on the demand curveArc elasticity of demandPrice elasticity of demand calculated over a range of prices2005 Pearson Education, Inc.48Elasticity: An ApplicationDuring the 1980s and 1990s, the market for wheat went t

38、hrough changes that had great implications for American farmers and US agricultural policyUsing the supply and demand curves for wheat, we can analyze what occurred in this market2005 Pearson Education, Inc.49Elasticity: An ApplicationSupply: QS = 1900 + 24PDemand: QD = 3550 266P2005 Pearson Educati

39、on, Inc.50Elasticity: An ApplicationQD = QS1800 + 240P = 3550 266P506P = 1750P = $3.46 per bushelQ = 1800 + (240)(3.46) = 2630 million bushels2005 Pearson Education, Inc.51Elasticity: An ApplicationWe can find the elasticities of demand and supply at these points2005 Pearson Education, Inc.52Elastic

40、ity: An ApplicationAssume the price of wheat is $4.00/bushel due to decrease in supply2005 Pearson Education, Inc.53Elasticity: An ApplicationIn 2002, the supply and demand for wheat were:Supply: QS = 1439 + 267PDemand: QD = 2809 226P2005 Pearson Education, Inc.54Elasticity: An ApplicationQD = QS280

41、9 - 226P = 1439 + 267PP = $2.78 per bushelQ = 2809 - (226)(2.78) = 2181 million bushelsPrice of wheat fell in nominal terms.2005 Pearson Education, Inc.55Short-Run Versus Long-Run ElasticityPrice elasticity varies with the amount of time consumers have to respond to a priceShort-run demand and suppl

42、y curves often look very different from their long-run counterparts2005 Pearson Education, Inc.56Short-Run Versus Long-Run ElasticityDemandIn general, demand is much more price elastic in the long runConsumers take time to adjust consumption habitsDemand might be linked to another good that changes

43、slowlyMore substitutes are usually available in the long run2005 Pearson Education, Inc.57Gasoline: Short-Run and Long-Run Demand CurvesDSRDLR People cannot easily adjust consumption in the short run. In the long run, people tend to drive smaller and more fuel efficient cars.Quantity of Gas Price200

44、5 Pearson Education, Inc.58Short-Run Versus Long-Run ElasticityDemand and DurabilityFor some durable goods, demand is more elastic in the short runIf goods are durable, then when price increases, consumers choose to hold on to the good instead of replacing itBut in long run, older durable goods will

45、 have to be replaced2005 Pearson Education, Inc.59DSRDLR Initially, people may put off immediate car purchase In long run, older cars must be replacedCars: Short-Run and Long-Run Demand CurvesQuantity of Cars Price2005 Pearson Education, Inc.60Short-Run Versus Long-Run ElasticityIncome elasticity al

46、so varies with the amount of time consumers have to respond to an income changeFor most goods and services, income elasticity is larger in the long runWhen income changes, it takes time to adjust spending2005 Pearson Education, Inc.61Short-Run Versus Long-Run ElasticityIncome elasticity of durable g

47、oodsIncome elasticity is less in the long run than in the short runIncreases in income mean consumers will want to hold more carsOnce older cars are replaced, purchases will only be to replace old carsLess purchases from income increase in long run than in short run2005 Pearson Education, Inc.62Dema

48、nd for Gasoline2005 Pearson Education, Inc.63Demand for Automobiles2005 Pearson Education, Inc.64Short-Run Versus Long-Run ElasticityMost goods and services:Long-run price elasticity of supply is greater than short-run price elasticity of supplyOther Goods (durables, recyclables):Long-run price elas

49、ticity of supply is less than short-run price elasticity of supply2005 Pearson Education, Inc.65SSRQuantity Primary Copper PriceShort-Run Versus Long-Run ElasticitySLRDue to limitedcapacity, firmsare limited byoutput constraintsin the short run. In the long run, theycan expand. 2005 Pearson Educatio

50、n, Inc.66SSRQuantity Secondary Copper PriceShort-Run Versus Long-Run ElasticitySLRPrice increasesprovide an incentiveto convert scrapcopper into new supply.In the long run, thisstock of scrap copperbegins to fall. 2005 Pearson Education, Inc.67Supply of Copper2005 Pearson Education, Inc.68Short-Run

51、vs. Long-Run Elasticity An ApplicationWhy are coffee prices very volatile?Most of the worlds coffee is produced in BrazilMany changing weather conditions affect the crop of coffee, thereby affecting pricePrice following bad weather conditions is usually short-livedIn long run, prices come back to or

52、iginal levels, all else equal2005 Pearson Education, Inc.69Price of Brazilian Coffee2005 Pearson Education, Inc.70Short-Run vs. Long-Run Elasticity An ApplicationDemand and supply are more elastic in the long runIn the short run, supply is completely inelasticWeather may destroy part of the fixed su

53、pply, decreasing supplyDemand is relatively inelastic as wellPrice increases significantly2005 Pearson Education, Inc.71DP0SQ0Quantity PriceA freeze or drought decreases the supplyof coffeeSQ1An Application - CoffeePrice increases significantly due to inelastic supply and demandP12005 Pearson Educat

54、ion, Inc.72SDSP0Q0P2Q2Intermediate-Run1) Supply and demand are more elastic2) Price falls back to P2.An Application - CoffeeQuantity Price2005 Pearson Education, Inc.73SP0Q0Long-Run1) Supply is extremely elastic2) Price falls back to P0.3) Quantity back to Q0.An Application - CoffeeQuantity PriceD20

55、05 Pearson Education, Inc.74Predicting the Effects of Changing Market ConditionsSupply and demand analysis can be used to predict the effects of changing market conditionsLinear demand and supply must be fit to market dataGiven equilibrium price and quantity along with elasticities of supply and dem

56、and, we can calculate the curves that fit the informationWe can then calculate changes in the market2005 Pearson Education, Inc.75Predicting the Effects of Changing Market ConditionsWe knowEquilibrium Price, P*Equilibrium Quantity, Q*Price elasticity of supply, ESPrice elasticity of demand, ED2005 P

57、earson Education, Inc.76Predicting the Effects of Changing Market ConditionsLets begin with the equations for supply, demand, elasticity:Demand: Q = a bPSupply: Q = c + dPElasticity: (P/Q)(Q/P)We must calculate numbers for a, b, c, and d.2005 Pearson Education, Inc.77Predicting the Effects of Changi

58、ng Market ConditionsThe slope of the demand curve above equals Q/P which equals -bThe slope of the supply curve above equals Q/P which equals dDemand: ED = -b(P*/Q*)Supply: ES = d(P*/Q*)2005 Pearson Education, Inc.78Demand: Q = a - bPa/bSupply: Q = c + dP-c/dP*Q*ED = -bP*/Q*ES = dP*/Q*Predicting the

59、 Effects of Changing Market ConditionsQuantity Price2005 Pearson Education, Inc.79Predicting the Effects of Changing Market ConditionsUsing P*, Q* and the elasticities, we can solve for b and c from supplyES = d(P*/Q*)1.6 = d(0.75/7.5) = 0.1dd = 16Q = c + dP7.5 = c + (16)(0.75) = c + 12c = -4.52005

60、Pearson Education, Inc.80Predicting the Effects of Changing Market ConditionsUsing P*, Q* and the elasticities, we can solve for a and b from demandED = b(P*/Q*)-0.8 = -b(0.75/7.5) = 0.1bb = 8Q = a bP7.5 = a (8)(0.75) = a 6a = 13.52005 Pearson Education, Inc.81Predicting the Effects of Changing Mark