00:01
So here we are doing some market analysis, right? so the first thing i want to do is draw a market, and i want to draw supply and demand curves.
00:09
And in the first case, we have technology is improving.
00:14
So technology is affecting the supply side, right? demand is buyers, and sellers, supply is usually firms.
00:24
So this is a firm shock, and we would think of this as an increase in supply.
00:29
So the way that i would model this would be that the supply curve is shifting out, right? but we also have income is increasing, right? income is increasing.
00:42
This is affecting buyers, and this would be an increase in demand because buyers have more income.
00:49
So demand is also gonna shift out.
00:52
Demand is gonna shift out, and that means we move from an original equilibrium right here to a new equilibrium right there.
01:00
The results are clearly that quantity is going up a lot.
01:06
Quantity is going up a lot, but the results in terms of price are unclear, right? we can't make a firm determination about price because we have these opposing effects.
01:20
So demand increases, equilibrium quantity increases, supply increases.
01:24
Everything else is wrong.
01:28
For the second one, we have, again, a market.
01:34
So i'm gonna draw the market, quantity and price...