Tag: Effect on equilibrium

Identify the market structure that best describes the hotel market and use examples to describe its key features.Assuming this market was in long-run equilibrium before the outbreak of COVID-19, use Microeconomics theories to analyze how the COVID-19 would affect this market in the short run and in the long run.

Hotel market structure

As the effects of COVID-19 spread across the entire world, the primary focus for governments and businesses is the safety of their people. Strategies to flatten the COVID-19 curve such as community lockdowns, social distancing, stay-at-home orders, travel, and mobility restrictions have significantly decreased the demand for many hospitality businesses. The hotel industry is a subdivision of the hospitality industry specializing in accommodation and is one of the most affected markets by the COVID-19.

a. Identify the market structure that best describes the hotel market and use examples to describe its key features.

b. Assuming this market was in long-run equilibrium before the outbreak of COVID-19, use Microeconomics theories to analyze how the COVID-19 would affect this market in the short run and in the long run.

Explain at least three factors that would result in a shift in the demand curve for that good and three factors that would result in a shift in the supply curve for that good.

Unit 3 Discussion Question

Identify a good you commonly use or would like to use.

Explain at least three factors that would result in a shift in the demand curve for that good and three factors that would result in a shift in the supply curve for that good.

Describe the effect on equilibrium price and quantity of each factor.

Finally, explain how the shifts in demand and supply are different from movements along the demand curve or movements along the supply curve and why the distinction is important.