Demand And Supply: The Use Of E-Books Has Increased Recently

Demand And Supplythe Use Of E Books Has Increased In Recent Years Esp

Demand and Supply The use of E-Books has increased in recent years, especially with the advent of mobile E-Readers. A marketing research firm recently developed the following supply and demand schedules for E-books: Price/E-Book Quantity Demanded Quantity Supplied $, Assignment Guidelines: Using Microsoft (MS) Excel, construct a graph showing supply and demand in the E-Book market based on the data above. (Save this file because you will re-work it later in the assignment.) When finished, copy and paste or import your graph into an MS Word document. (Tutorials for working with MS Excel and MS Word can be found through the Tutoring Services and Tutorials link at the top of the page.) In your MS Word document, below your imported graph, respond to the following: Explain how the Laws of Supply and Demand are illustrated in this graph . Describe the equilibrium price and quantity in this market . Assume that the government imposes a price floor of $12 in the E-Book market. Explain what would happen in this market . Assume that the price ceiling is imposed at $6. Explain what would happen in this market . Now, assume that the price of E-Readers (used with E-Books) drops by fifty percent. How would this change impact the demand for E-Books? Explain your answer. Then, reconstruct your original graph to show this change and place it in your MS Word document below your explanation. Remember, quotations, paraphrases, and ideas you get from books, articles, or other sources of information should be cited using APA style . Help with citing sources can be found through the Academic Resources Course Home . Save your MS Word file using the filename LastnameFirstInitial_M1A3 and submit it to the M1: Assignment 3 Dropbox by Satur day, February 22, 2014 . Assignment 3 Grading Criteria Maximum Points Correctly constructed the supply and demand graph. 12 Answered Question 2-5 correctly, 15 points each. 60 Answered question 6 correctly and correctly constructed a new supply and demand graph. 8 Wrote in a clear, concise, and organized manner; demonstrated ethical scholarship in accurate representation and attribution of sources; displayed accurate spelling, grammar, and punctuation. 20 Total: 100 Microsoft Excel Tutorials: Microsoft Office 2010 Microsoft Office 2003

Paper For Above instruction

The rise in the use of e-books in recent years has been a significant shift in the digital publishing industry, driven by technological advancements and changing consumer preferences. The integration of mobile e-readers and tablets has made accessing digital books more convenient, leading to a noticeable increase in demand. To analyze this trend, we construct a supply and demand graph based on hypothetical data, illustrating fundamental economic principles such as the laws of supply and demand, market equilibrium, and government intervention impacts.

Designing a graph in Microsoft Excel involves plotting the quantity demanded and supplied at various price points. Typically, the demand curve slopes downward, indicating that as prices decrease, the quantity demanded increases. Conversely, the supply curve slopes upward, showing that higher prices incentivize producers to supply more. When these two curves intersect, market equilibrium occurs, representing the price and quantity where quantity demanded equals quantity supplied. This intersection point, termed the equilibrium price and quantity, balances consumer preferences with producer incentives.

In the constructed graph, the demand curve and supply curve intersect at a specific price — say, $8, with an equilibrium quantity of 1,000 e-books. This point demonstrates the natural balance in the market absent external interference. The laws of supply and demand are vividly illustrated here; a decrease in price leads to increased demand, while higher prices motivate greater supply. These relationships reflect classic economic theory, confirming that markets tend to self-correct toward equilibrium.

When the government introduces a price floor of $12, which is above the equilibrium price, the immediate consequence is a surplus. At this price, consumers are less willing to buy, while producers are willing to supply more e-books. The result is a surplus of e-books that may remain unsold. This excess supply puts downward pressure on prices, but since the price floor prevents prices from falling below $12, the surplus persists, potentially leading to wastage or government purchasing programs to clear excess stock.

Conversely, imposing a price ceiling at $6, below the equilibrium price, results in a shortage. Consumers desire more e-books at this lower price, but producers are unwilling to supply sufficient quantities because the price no longer covers their costs or provides enough profit margin. This mismatch creates a scarcity, which could lead to black markets or rationing if enforced strictly. These government interventions demonstrate how price controls distort the natural functioning of supply and demand, often leading to unintended economic consequences.

Furthermore, the reduction in the price of E-Readers by fifty percent significantly impacts the demand for e-books. E-Readers serve as the primary medium for consuming digital books; thus, a substantial decrease in their price makes e-books more accessible and attractive to consumers. As a result, demand for e-books would likely increase, shifting the demand curve to the right. This change reflects increased consumer willingness to purchase e-books due to the lower combined cost of device and content.

Reconstructing the graph with this increased demand involves shifting the demand curve outward, resulting in a new equilibrium point with a higher quantity demanded at each price level. The new equilibrium could occur at a higher quantity, perhaps at $8 with 1,200 e-books demanded, depending on the magnitude of consumer response. This shift exemplifies the sensitivity of digital goods markets to price changes in complementary products like E-Readers, highlighting the interconnected nature of technological ecosystems and consumer behavior.

References

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  • OECD. (2022). Digital Economy Outlook. OECD Publishing.
  • Statista. (2023). E-Book Market Revenue Worldwide. https://www.statista.com
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