c. What will be the effect on the equilibrium situation of sports goods industry if cost
of production of sports goods increases due to high per unit cost of electricity.
Illustrate graphically.
When the COP will increase, then it lead to decrease in profit, producer earn low profit or bear losses. so they decrease the production. Resultantly demand increase thats leades to increase in prices. :( Sad but true ;-) so new equilibrium will..........
d. Suppose the Government takes initiatives to improve technology and provide
better infrastructure, what will be the impact of these initiatives on equilibrium
situation? Illustrate graphically.
Idea: When the technology provided then product quality and sale will increase. Then profit & production will increase. When production (Supply) will increase then thats lead to decrease in price. Equilibrium will be...
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