Assume that the price floor is removed and a price ceiling is imposed at $6. Explain what would happen in this market.
Using Microsoft (MS) Excel, construct a graph showing supply and demand in the E-Book market based on the data above. When finished, copy and paste or import your graph into an MS Word document.
In your MS Word document, below your imported graph, respond to the following:
- Explain how the Laws of Supply and Demand are illustrated in this graph.
- Describe the equilibrium price and quantity in this market.
- Assume that the government imposes a price floor of $12 in the E-Book market. Explain what would happen in this market.
- Assume that the price floor is removed and a price ceiling is imposed at $6. Explain what would happen in this market.
- Now, assume that the price of E-Readers (used with E-Books) drops from $60 by fifty percent. How would this change impact the demand for E-Books? Explain your answer. Then, reconstruct your original graph to show this change and place it in your MS Word document below your explanation.
Remember, quotations, paraphrases, and ideas you get from books, articles, or other sources of information should be cited using APA style. 3-4 pages.
|Assignment 3 Grading Criteria|
|Correctly constructed the supply and demand graph.|
|Answered Question 2-5 correctly, 15 points each.|
|Answered question 6 correctly and correctly constructed a new supply and demand graph.|
|Wrote in a clear, concise, and organized manner; demonstrated ethical scholarship in accurate representation and attribution of sources; displayed accurate spelling, grammar, and punctuation|