Use the Supply and Demand Model to Explain What Happens

question 121

Essay

Use the supply and demand model to explain what happens to the equilibrium price and the equilibrium quantity for pasta in the following cases:
(A)There is a large expansion in the number of firms producing pasta.
(B)It is widely publicized in the press that pasta isn't as healthful as previously thought.
(C)There is a sudden increase in the price of pasta flour,which is used to produce pasta.
(D)Pasta suddenly becomes popular because a movie idol promotes it in television commercials.

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Definitions:

Utilization

Refers to the extent to which a resource, such as equipment or workforce, is being used effectively in a production process.

λ

A symbol commonly used in mathematics and engineering to represent wavelength, decay constants, or other specific parameters within various contexts.

μ

A symbol commonly representing the mean or average in statistics and probability, summarizing central tendency of a dataset.

M/M/1 Assumptions

Assumptions used in queueing theory for a single-server queue, including exponential service times and arrivals being a Poisson process.