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Problem Assignments and Readings Economics 201 Professor R. Fisher FALL 1998 ? Ronald C. Fisher, 1998 These assignments are due in class on the day assigned according to the class schedule. They will be collected and graded on a credit (4 points) -no credit (0 points) basis. The grade depends only on whether you turned the assignment in on time and whether you made a sincere effort to answer the questions. Assignments turned in late will not receive credit. Regardless of the format of the problem, you should always show how you arrived at your answer and include substantial explanation. It is not sufficient merely to state an answer (12 or B). Fall 1998 ECONOMICS 201 R. Fisher Assignment No. 1 Due: September 10 1. Colander, Chapter 3, Problem #2. 2. Colander, Chapter 3, Problem #4. 3. When the price of a commodity like coffee increases, some consumers usually come up with the idea of a buyers strike. That is, they propose to buy no coffee in order to drive the price down. a. If the strike is successful, who gains? b. What gain goes to those who boycott? c. Would you join or only advise others to join the boycotts? d. What do you think will happen to the price of tea during the boycotts? Explain all answers. 4. The Wall Street Journal reported that in 1985 good deals were available in the fall on used cars because the automobile manufacturers offered summer sales incentives on new cars that left dealers with a gut of trade-ins. Since the incentives began, used car prices fell 12.5%. During the same period in the previous year, when there were no new car sales incentives, and car prices fell only 3.2%. The new car incentives included rebates and low-interest loans. Record numbers of new cars were sold in August and September, and many buyers traded in used cars. And some buyers who might have purchased late-model used cars switched to new cars because of the incentives.