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(Solved) Economic Principles- Assignment

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Added on  2020-05-16

(Solved) Economic Principles- Assignment

   Added on 2020-05-16

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Running Head: ECONOMIC PRINCIPLESEconomic PrinciplesName of the StudentName of the UniversityAuthor note
(Solved) Economic Principles- Assignment_1
1ECONOMIC PRINCIPLESTable of ContentsAnswer 1....................................................................................................................................2Answer 2....................................................................................................................................4Answer 3....................................................................................................................................8Answer 4..................................................................................................................................10Answer 5..................................................................................................................................11References................................................................................................................................13
(Solved) Economic Principles- Assignment_2
2ECONOMIC PRINCIPLESAnswer 1a)Figure 1: Fuel-efficient car market (Source: as created by Author)When petrol price increases following a shortage of supply, then people are morewilling to use fuel efficient cars as it require less petrol (Krugman et al. 2015). Accordingly,the demand curve will shift to the right to D1D1. At the old equilibrium price P1, the newdemand creates car shortage of the amount (Q3 – Q1). With new demand, the supply anddemand balances at E2. This is the new equilibrium point with price P2and equilibriumquantity Q2.b)
(Solved) Economic Principles- Assignment_3
3ECONOMIC PRINCIPLESFigure 2: Car market using petroleum substitute (Source: as created by Author)When petrol price rises then demand for petrol substitute fuels increases. This willincrease the demand for cars that use liquid gas. An outward shift of the demand curve toD1D1, reflects this change in demand. At the existing equilibrium price P*, this creates anexcess demand or shortage of these cars equals to (Q2 – Q*). The balance between newdemand and the existing supply curve SS is indicated by the new equilibrium point E1. At E1,there is a higher price P1 and a larger number of cars Q1 in the market.
(Solved) Economic Principles- Assignment_4

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