Posted: January 25th, 2017

Explain the difference between a normal good and an inferior good.

Please help with homework

You have been hired by a new firm selling electronic dog feeders. Your client has asked you to gather some data on the supply and demand for the feeder, which is given below, and address several questions regarding the supply and demand for these feeders.

Price/Feeder

Quantity Demanded

Quantity Supplied

$300

500

1800

270

600

1700

240

700

1600

210

800

1500

180

1000

1400

150

1100

1300

120

1200

1200

90

1300

1100

60

1400

1000

30

1500

900

10

1600

800

Your client has asked that you develop a report addressing the following questions so that you can present these findings to their Board of Directors:

Questions:

Construct a graph showing supply and demand in the electronic dog feeder market, using Microsoft Excel.

How are the laws of supply and demand illustrated in this graph? Explain your answers.

What is the equilibrium price and quantity in this market?

Assume that the government imposes a price floor of $180 in the feeder market. What would happen in this market?

Assume that the price floor is removed and a price ceiling is imposed at $90. What would happen in this market?

Now, assume that the price of feeders drops by 50%. How would this change impact the demand for feeders? Explain your answer and reconstruct the graph developed in question one to show this change.

Assume that incomes of the consumers in this market increases. What would happen in this market? Explain your answer and reconstruct the graph developed in question one to show this change.

Assume that the number of sellers decreases in this market. What would happen in this market? Explain your answer and reconstruct the graph developed in question one to show this change.

Explain the difference between a normal good and an inferior good. Would your answers to question 7 change depending on whether this good is a normal or inferior good? Why?

Deliverables:

Develop your analysis in Microsoft Excel format. Enter non-numerical responses in the same worksheet using textboxes.

plrase cite all sources