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1. The graph below shows the supply and demand curves for air conditioners. Show the equilibrium by clicking on the graph to place a dot at the place where the equilibrium point is.

Clear All Draw: Dot

Hint

Box 1: Enter your answer by drawing on the graph.

2. Here are the equations for the demand and supply curves:

Demand curve: `Qd=3300-2 P`

Supply curve: `Qs=500+8 P`

Compute the equilibrium price value:

Demand curve: `Qd=3300-2 P`

Supply curve: `Qs=500+8 P`

Compute the equilibrium price value:

Hint

Box 1: Enter your answer as an integer or decimal number. Examples: 3, -4, 5.5172

Enter DNE for Does Not Exist, oo for Infinity

3. Compute the equilibrium quantity value:

Hint

Box 1: Enter your answer as an integer or decimal number. Examples: 3, -4, 5.5172

Enter DNE for Does Not Exist, oo for Infinity

4. Suppose Congress cuts personal income tax rates. Which graph most accurately shows how this would affect the market for air conditioners? Note that the new curve is shown in grey.

Hint

Box 1: Select the best answer

5. Why does the demand or supply curve shift the way it does and what element of demand caused the shift? How does that affect the equilibrium price and quantity?

Hint

Box 1: Enter your answer as text. This question is not automatically graded.

6. Suppose that air conditioner workers accept a pay cut of per hour. Which graph most accurately shows how this would affect the market for air conditioners? Note that the new curve is shown in grey.

Hint

Box 1: Select the best answer

7. Why does the demand or supply curve shift the way it does and what element of demand caused the shift? How does that affect the equilibrium price and quantity?

Hint

Box 1: Enter your answer as text. This question is not automatically graded.