kaplan Bus 204 Unit 3

Unit 3 [BU204: Macroeconomics]

Unit 3 Assignment: Supply and Demand

Model and PPF

1. Your Assignment should have a cover sheet with the following information:

? Your Name

? Course Number

? Section Number

? Date

2. You may submit your Assignment using the Unit 3 Assignment template, renaming it as required in item 4 below.

3. Your answers should follow the APA format by being in double spaced paragraph format, with citations to your sources and, at the bottom of your last page, a list of references. Your answers should also be in Standard English with correct spelling, punctuation, grammar, and style.

4. Unless specified differently by your instructor, your completed Assignment should be saved with the following file name format: course number, an underscore, section number, an underscore, your LAST name, underscore, your FIRST name, an underscore, the unit number, an underscore, and the word “Assignment.” It will look like this: BU204_section number_LAST_FIRST_ Unit number_ Assignment. (BU204_2_Smith_Tina_Unit 3_Assignment.docx)

5. Respond to the questions in a thorough manner, providing specific examples of concepts, topics, definitions, and other elements asked for in the questions. Your paper should be highly organized, logical, and focused.

6. Required Format:

? Correct filename

? Correct APA format for answers (cover sheet with name, course number, section number, unit number, date, answers double spaced, in Times New Roman 12-point font)

? Correct citations within answers

? Standard English with no spelling or punctuation errors

? Correct references at the bottom of the last page

Question:

As a marketing specialist working for a production company, it is your job to explain to investors how the current status of the supply will meet the changing demand for products. Based on the following Assignment questions compile answers that effectively addresses the hypothetical examples provided in the Assignment.

In this Assignment, you will be practicing the following Professional Competencies:

? Analyze quantitative data

1) The table below indicates the total quantity supplied and demanded of flashlights at different price levels.

Unit 3 [BU204: Macroeconomics]

Price	Quantity Demanded	Quantity Supplied
	Per Month	Per Month
$5	6,000	10,000
$4	8,000	8,000
$3	10,000	6,000
$2	12,000	4,000
$1	14,000	2,000

a) Draw Supply and Demand Curves.

b) What are the equilibrium price and the equilibrium quantity?

c) Suppose the market price is $5. What problem would exist in the market? Does it lead to surplus or shortage? How do you expect this problem will affect the price? Indicate this on the supply and demand graphs.

d) Assume the market price is currently $2. What problem would occur in the market due to this price? Will it be shortage or surplus? What will its effect on the price? Indicate this on the supply and demand graph.

2) Consider supply and demand schedules for Alaska Salmon indicated in the following tables to answers questions from a –d below.

Price of Salmon per Pound	Quantity of Salmon Supplied (pounds)
$30	900
$25	700
$20	600
$15	300

Unit 3 [BU204: Macroeconomics]

$10	100

First, assume that Alaskan Salmon can be sold only in the United States. The U.S. demand schedule is as follows:

Price of Salmon per Pound	USA Quantity of Salmon Demanded
	(pounds)
$30	100
$25	300
$20	600
$15	700
$10	900

a. Referring to the schedules of supply and demand, what is the equilibrium price of Salmon? What is the equilibrium quantity of salmon demanded and supplied at the equilibrium price?

b. Second, assume that Alaskan Salmon can also be sold in UK. The UK demand schedule for salmon is as follows:

Price of Salmon per Pound	Quantity of Salmon Demanded (pounds)
$30	200
$25	400
$20	500
$15	700
$10	900

Unit 3 [BU204: Macroeconomics]

What is the combined demand schedule for Alaskan salmon after the UK consumers join the market for Alaskan salmon?

c. Refer to the combined U.S. and UK demand schedule, the U.S. demand schedule and the supply schedule, and analyze the change in the market for Salmon .What will happen to the price at which fishermen can sell Salmon? What will be the final output of Salmon?

d. After UK joins the market demand for salmon, what will happen to the price U.S. consumers pay for salmon? What will happen to the quantity of salmon consumed by U.S. consumers?

3) Assume Atlantis is a small, isolated island in the South Atlantic. The inhabitants grow potatoes and catch fresh fish. The accompanying table shows the maximum annual output combinations of potatoes and fish that can be produced. Obviously, given their limited resources and available technology, as they use more of their resources for potato production, there are fewer resources available for catching fish.

	Quantity of Potatoes	Quantity of Fish (Pounds)
	(Pounds)
A	1,000	0
B	800	300
C	600	500
D	400	600
E	200	650
F	0	675

Unit 3 [BU204: Macroeconomics]

Consider the maximum annual output of potatoes and fish indicated in the table above. The maximum output of the two products is also indicated on the Production Possibility Frontier graphs below. Answer the following questions from a – e using the information in the table and PPF graphs.

a. Is it feasible for Atlantis to produce 500 pounds of fish and 800 pounds of potatoes? Explain.

b. Calculate the opportunity cost of increasing the annual output of potatoes from 800 to 1000 pounds.

c. Calculate the opportunity cost of increasing the annual output of potatoes from 400 to 600 pounds.

d. What is the difference between the answers to parts b and c?

e. What does the change in opportunity costs indicate about the slope of the production possibility frontier?

Unit 3 [BU204: Macroeconomics]

Unit 3 Assignment: Supply and Demand Model and PPF
Content and Analysis	Points	Points
	Possible	Earned
Problem # 1	3
Correctly drew supply and demand curves. (“a”)
Correctly explained the equilibrium values. (“b”)	2
Correctly explained the excess demand and excess supply. (questions “c” and “d”)	4
Problem #2	3
Correctly identified equilibrium price and quantity.
Provided a demand schedule for the combined demand of U.S. and UK	4
consumers.
Identified the new market price and quantity supplied.	2
Identified the new price U.S. consumers pay and the new quantity demanded.	2
Problem #3	2
Identified the infeasible production. (“a”)
Correctly calculate the opportunity cost. (“b”)	2
Correctly calculate the opportunity cost. (“c”)	2
Explained the differences in opportunity costs. (“d”)	2
Explained the nature of the slope of PPF. (“e”)	2
Writing Style, Grammar, and APA Format.	5
	35