Category: Economics

➤ When are elections held for U.S. Senate, California State Senate, and State Assembly?
General elections for federal and state offices take place on the first Tuesday after the first Monday in November of even-numbered years. U.S. Senate terms last six years, State Senate terms are four years (staggered), and Assembly terms are two years. Primaries occur earlier, and special elections can fill vacancies between cycles.

3.
➤ How do economists distinguish inferior goods from normal goods using income elasticity?
They calculate income elasticity of demand: percentage change in quantity divided by percentage change in income. A negative elasticity signals an inferior good. A positive elasticity indicates a normal good. Empirical estimates from household data or surveys confirm whether a product is inferior or normal.

If we place a price floor of $8 and the equilibrium price is $7 and the equilibrium quantity is 20 units. How do you find the quantity demand and quanity supplied?
Answer
Because the price floor ($8) is above the equilibrium price ($7), the floor is binding and the market price will be $8 rather than $7.
The quantity demanded at the new price is Qd = D(8). The quantity supplied at the new price is Qs = S(8).
Without the explicit demand and supply functions you cannot compute numeric values. You can, however, conclude that Qd < 20 and Qs > 20, so a surplus occurs equal to Qs − Qd.
To get numbers, substitute p = 8 into the demand and supply equations (for example, if D(p) = a − b p and S(p) = c + d p, compute D(8) and S(8)).

Economists use the term ceterus poritus to indicate thatA) the analysis is true for the individual but not for the economy as a wholeB) supply and demand are in balance

If the product represented is a normal good, a decrease in income would be represented by a change from
A to B
B to A
D1 to D2
D2 to D1