. Start in Equilibrium (be sure to label all relevant points) b. Change at least one of the ceteris paribus conditions. This time, there’s been no change in the price of beer. But a study was just released that shows, conclusively, that eating pizza makes you smarter. c. Examine the changed incentive. Which curve(s) has(have) changed? Why? (i.e. – which of the ceteris paribus conditions have changed?) _______________________________________________________ d. Identify the change(s) in direction, and draw into the above market. e. Finish in equilibrium. What are the effects on price and quantity?

. Start in Equilibrium (be sure to label all relevant points) b. Change at least one of the ceteris paribus conditions. This time, there’s been no change in the price of beer. But a study was just released that shows, conclusively, that eating pizza makes you smarter. c. Examine the changed incentive. Which curve(s) has(have) changed? Why? (i.e. – which of the ceteris paribus conditions have changed?) _______________________________________________________ d. Identify the change(s) in direction, and draw into the above market. e. Finish in equilibrium. What are the effects on price and quantity?

Principles of Economics, 7th Edition (MindTap Course List)

7th Edition

ISBN:9781285165875

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter21: The Theory Of Consumer Choice

Section: Chapter Questions

Problem 13PA

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5. Consider the market for pizza.a. Start in Equilibrium (be sure to label all relevant points)b. Change at least one of the ceteris paribus conditions. Assuming pizza and beer go well together, consider the market for pizza if the price of beer goes up.c. Examine the changed incentive. Which curve(s) has(have) changed? Why? (i.e. – which of the ceteris paribus conditions have changed?) _______________________________________________________d. Identify the change(s) in direction, and draw into the above market.e. Finish in equilibrium. What are the effects on price and quantity?
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