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... Excel Answer Sheet for Economics 210 Chapter: To Accompany Excel Workbook: “6_controls.xls” and “6_excise_taxes.xls” Refer to the Above Excel Workbook in answering the questions below. For each spreadsheet in the workbook, a spreadsheet title and a brief description of the spreadsheet precede one or ...
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... STEP 1: The formula used to calculate the percentage change in quantity demanded is: [QDemand(NEW) - QDemand(OLD)] / QDemand(OLD) STEP 2: The formula used to calculate the percentage change in price is: [Price(NEW) - Price(OLD)] / Price(OLD) STEP 3: (STEP 1) / (STEP 2) Price ...
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... directly affects the amount of another item that can be purchased. b. When the price of a substitute item decreases, consumers will purchase more of the substitute. i. A substitute is a product that is similar to and can replace another product. ii. For example, a substitute for pistachios would be ...
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Supply and demand



In microeconomics, supply and demand is an economic model of price determination in a market. It concludes that in a competitive market, the unit price for a particular good, or other traded item such as labor or liquid financial assets, will vary until it settles at a point where the quantity demanded (at the current price) will equal the quantity supplied (at the current price), resulting in an economic equilibrium for price and quantity transacted.The four basic laws of supply and demand are: If demand increases (demand curve shifts to the right) and supply remains unchanged, a shortage occurs, leading to a higher equilibrium price. If demand decreases (demand curve shifts to the left) and supply remains unchanged, a surplus occurs, leading to a lower equilibrium price. If demand remains unchanged and supply increases (supply curve shifts to the right), a surplus occurs, leading to a lower equilibrium price. If demand remains unchanged and supply decreases (supply curve shifts to the left), a shortage occurs, leading to a higher equilibrium price.↑
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