MGEA02H3 Lecture Notes - Complementary Good, Perfect Competition, Substitute Good
wanyiwu and 39094 others unlocked
38
MGEA02H3 Full Course Notes
Verified Note
38 documents
Document Summary
Demand and supply curve (from fall 2011 term test 1, question 13- 15) The market for swordfish is perfectly competitive, and is in equilibrium. Its short run supply and demand schedules have the usual shapes. Swordfish is normal good and you can safely ignore any effects of income on the demand for relate goods. Lemons are a complementary good to swordfish, and salmon is a substitute good for swordfish. Question 13 through 15 concerns the market for swordfish in the short run. And each question should be considered in isolation from the others. In all cases, p* and q* refer to the equilibrium price and quantity of swordfish. At the same time, the price of lemons falls. Capital price increase, at the same time, the price of salmon rises (substitute price rises). At the same time, the price of lemons rises.