Number 2

(6-pack of Wolverine Root Quantity Demanded Quantity Supplied Beer) 10.00 500 3000 8.00 700 2000 6.00 1000 1000 4.00 1400 900 2.00 2000 800 Draw a graph to illustrate the market demand and supply for Wolverine Root Beer. What is the equilibrium price and quantity? Describe the situation that would result if the price of Wolverine Root Beer was $4.00. 2. Gertrude loves both Wolverine Root Beer and Spartan Root Beer. What if she goes shopping and finds that Wolverine Root Beer is on sale and the price has just fallen, relative to Spartan Root Beer. What effect will this have on her demand for Spartan Root Beer? Why? Use words and graphs to show what will happen in both the Wolverine and Spartan root beer markets (use separate graphs for each product). 3. Gertrude loves eating pretzels with root beer (all brands of root beer). What effect would a rise in the price of pretzels have on her demand for root beer? Why? Again, use words and a graph for the root beer market to demonstrate your answer. 4. Wolverine and Spartan root beer are the best root beers according to the Root Beer Review. There is also the generic store brand root beer - People's Choice brand- that is also sold where Gertrude shops. Suppose that there is a recession. Gertrude's employer cuts her hours and, as a result, her weekly pay declines. What will this do to her demand for generic root beer? Draw a graph of the generic root beer market and explain what happened and why