ECON&202 (ONL): Group Activity 2

Covers Chap 4 - 6
Chapter 4:
Supply and Demand Diagrams
Group 1 Leader: Tommy H.
Group Members: Rebecca N., Rosa M., Keivan R., Richard N. & Shaza S.
I. 10th Edition: p. 84, Problems and Applications, Q6
9th Edition: p. 84, Problems and Applications, Q6
8th Edition: p. 87, Problems and Applications, Q6.

Calculating Price and Equilibrium

Group 2 Leader: Anisa A.
Group Members: Rolando M-A., James M., Nicholas Z., Binh “Tracy” T. & Sayed S.
II. Market research has revealed the following information about the market for chocolate bars:
The demand schedule can be represented by the equation Qd = 1,600 – 300P, where Qd is the
quantity demanded and P is the price. The supply schedule can be represented by the
equations Qs = 1,400 + 700P, where Qs is the quantity supplied.
a. Calculate the equilibrium price and quantity in the market for chocolate bars.
b. Draw a supply and demand diagram illustrating the equilibrium price and quantity.
c. Which equation is the demand curve? Why?
d. Which equation is the supply curve? Why?

&
Read Article: “California Freeze Puts Squeeze on Citrus Crop”, By Annys Shin, Washington
Post Staff Writer, Saturday, January 20, 2007. Link provided by The Washington Post:

http://www.washingtonpost.com/wp-dyn/content/article/2007/01/19/AR2007011901647.html?referrer=emailarticle

When reading the article, you should do the following (Response should be no more than a ½
page):
• Discuss the main points and summarize the article
• How does this article relate to this class? Talk about the concepts we discussed in class
(Shifting the supply curve, equilibrium prices/quantity, cross elasticity and so forth).

Chapter 5:
Calculating Price Elasticity of Demand
Group 3 Leader: Simon B.
Group Members: Huey L., Abdi A., Anai V., Anh N. & Washington V.

III. Suppose that your demand schedule for DVDs is as follows:

Quantity Demanded Quantity Demanded
Price (income = $10,000) (income = $12,000
$8 40 DVDs 50 DVDs
10 32 45
12 24 30
14 16 20
16 8 12
 a. Use the percentage change or the midpoint method to calculate your price elasticity of
demand as the price of DVDs increases from $8 to $10 if (i) your income is $10,000 and
(ii) your income is $12,000.
b. Use the percentage change or the midpoint method to calculate your income elasticity of
demand as your income increases from $10,000 to $12,000 if (i) the price is $12 and (ii)
and the price is $16.

Supply and Demand Diagrams (Elastic and Inelastic)

Group 4 Leader: Aaron M.
Group Members: DeBear S., Ark P., Misty R., Diana S. & Zakariye B.
IV. Suppose that pharmaceutical drugs have an inelastic demand, and computers have an elastic
demand. Due to a technological advance in both markets, the supply curve of both markets
doubles the supply of products.
a. What happens to the equilibrium price and quantity in each market?
b. Which product experiences a larger change in price?
c. Which product experiences a larger change in quantity?
d. What happens to total consumer spending (total revenue) for each product?

Chapter 6:
Group 5 Leader: Mohamed O.
Group Members: Hoa M., Nhi N., Maurice A., Sendrell Y. & Zhiqi “Aaron” Z.
V. 10th Edition: p. 130, Problems and Applications, Q3 (Graph each part of the question).
9th Edition: p. 128-9, Problems and Applications, Q3 (Graph each part of the question).
8th Edition: p. 129, Problems and Applications, Q3 (Graph each part of the question).

(Last revision: Thurs., Jan. 11th, 2024)