Reference no: EM13209803

Identify changes in market conditions and their effect on equilibrium price and quantity for the following events:
Event 1: The wages for all dental assistants increase, increasing the costs of inputs.
Event 2: The government provides national dental insurance benefits for all U.S. citizens that cover 100% of the cost of all dental services. There are two effects of this policy. First, there will be an increase in the number of consumers of dental services. Second, there will be fewer dentists willing to provide dental services, resulting in some dentists removing themselves from the market entirely.
Perform the following for each event:
• Graph the initial equilibrium using the myeconlab grapher software. Note: You do not need to change the numbers on each axis, but you do need to label each axis and each curve.
• Answer the following questions.
o Determine whether demand or supply changes, or both.
o Determine whether the change is an increase or a decrease.
o Show the change in demand and/or supply on the graph of the initial equilibrium. (You will have one graph for each event.)
o Identify the result on the equilibrium price and quantity of dental services.
• Insert the graph into a Word document. To paste the graphed image on a Word document, press and hold "ALT," then press "PrtScrn" while viewing the graphed image. Select a point on the Word document to paste the graph. Press and hold "Ctrl," then press "V."
Task 2:
Interpreting Graphs
Identify and explain specific effects of price controls at given prices.
Using the hypothetical information in the table on the market for gasoline, complete the following questions:

Price of Gasoline (per gallon) Quantity Demanded (millions of gallons per week) Quantity Supplied (millions of gallons per week)
$0.50 85 0
$1.00 75 15
$1.50 65 20
$2.00 55 25
$2.50 45 30
$3.00 35 35
$3.50 25 45
$4.00 15 55
Fill in the blanks highlighted in yellow.

A. Graph the demand and supply for gasoline using the myeconlab grapher software Please start your graph at the origin and label each axis and each curve. (Note: Change the numbers on each axis. Label each axis and each curve. Start your graph from the origin.)
Insert the graph into a Word document. To paste the graphed image on a Word document, press and hold "ALT," then press "PrtScrn" while viewing the graphed image. Select a point on the Word document to paste the graph. Press and hold "Ctrl," then press "V."
Next, answer the following questions.

B. The equilibrium price of gasoline is _____ and the equilibrium quantity is ___.

C. The government imposes a price ceiling of $2.50 in this market. The prevailing price in this market is now _______. The quantity demanded is now _________ and the quantity supplied is __________.

D. The price ceiling results in a (SURPLUS OR SHORTAGE) _______________ in the amount of _______.