What is the magnitude of the change in the equilibrium price and equilibrium quantity?

ar Show more Suppose D0 and S0 are the initial demand and supply curves for solar electric panels. P0 * and Q0 * are respectively the initial equilibrium price and initial equilibrium quantity in the market for solar panels. A new technology reduces the cost of producing solar panels. Using comparative statics analyze how the equilibrium price and equilibrium quantity in the market for solar panels will change as a result of this new technology? Be sure to illustrate your answer with graph. (5 points) Suppose D0 and S0 are the initial demand and supply curves for tablets. P0 * and Q0 * are respectively the initial equilibrium price and initial equilibrium quantity in the market for tablets. Rapid economic growth over the last three years has substantially increased the disposable income of most households. Using comparative statics analyze how the equilibrium price and equilibrium quantity in the market for tablets will change as a result of the increase in disposable income. Be sure to illustrate your answer with graph. (5 points) Suppose that a market with an inelastic supply curve experiences a shift to the right in the demand curve. Using comparative statics analyze how the equilibrium price and equilibrium quantity in this market will change as a result of the shift to the right in the demand curve. What is the magnitude of the change in the equilibrium price and equilibrium quantity? Be sure to illustrate your answer with graph. (5 points) Suppose that a market with an inelastic demand curve experiences a downward shift in the supply curve (to the right). Using comparative statics analyze how the equilibrium price and equilibrium quantity in this market will change as a result of an upward shift in the supply curve. What is the magnitude of the change in the equilibrium price and equilibrium quantity? Be sure to illustrate your answer with graph. (5 points) Part II (30 points) Suppose an industry that has 10 firms. Below are the market shares for 2010 and 2015 of the 10 firms. Market Share Market Share Firms 2010 2015 A B C D E F G H I G 26% 21% 16% 10% 9% 7% 4% 3% 2% 2% 23% 22% 19% 9% 8% 7% 6% 4% 1% 1% Calculate the concentration ratio CR4 and the concentration ratio CR8 for 2010 and 2015 (5 points) Calculate the Herfindahl-Hirschmann Index (HHI) for 2010 and 2015 (5 points) Using the CR4 CR8 and HHI analyze the evolution of the seller concentration in the industry. Has the industry become more or less concentrated? (10 points) Using the CR4 CR8 and HHI analyze the evolution of the potential market power of firms in the industry. (10 points) Show less

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