Dominick Salvatore Schaums Outline of Microeconomics, 4th edition Schaums Outline Series 2006

CHAP. 2] DEMAND, SUPPLY, AND EQUILIBRIUM: AN OVERVIEW 35
(b)
Fig. 2-24
(c)
When D x shifts up to D 0 x (while everything else remains the same), the equilibrium price of X rises from $3 to
$3.50. The equilibrium quantity of X rises from 60,000 to 70,000 units per time period.
2.22 Suppose that from the condition of equilibrium in Problem 2.17, there is an improvement in the technology
of producing commodity X (ceteris paribus) so that a new market supply curve is given by
QS 0 x ¼ 40,000 þ 20,000P x.(a) Derive the new market supply schedule, (b) show the new market
supply curve (S 0 x) on the graph of Problem 2.17(c), and (c) state the new equilibrium price and the
new equilibrium quantity for commodity X.
(a) Table 2.26
P x ($) 6 5 4 3 2 1 0
QS 0 x 160,000 140,000 120,000 100,000 80,000 60,000 40,000
(b)
Fig. 2-25
(c)
When S x shifts down to S 0 x (an increase in supply resulting from an improvement in technology, while
everything else remains constant), the equilibrium price of X falls from $3 to $2. The equilibrium quantity
of X rises from 60,000 to 80,000 units per time period.