The response to the question MUST be typed and formatted following APA 6th edition style.
Students are expected to use economic textbooks and Journals.
1. Answer the following questions using supply and demand analysis. The use of appropriate diagrams is encouraged.
a) What is the effect on the equilibrium price and quantity traded in a market of the introduction of a new technology that reduces costs of production for all firms?
b) What is the effect on the equilibrium price and quantity traded in a market of a change in tastes that reduces the demand for the product?
c) What is the effect on the equilibrium price and quantity traded in a market of the imposition of a tax per unit sold on suppliers?
d) What is the effect on the equilibrium price and quantity traded in a market of the payment of a subsidy per unit sold paid to suppliers?
2. It is said that elasticity is the measurement of how responsive a change in the price of a product as against the change in the quantity demanded. Using this statement identify and discuss five (5) uses of elasticity's to the public sector and five (5) uses of elasticity's to the private sector.