Consider the market for minivans. for each of the events listed here, identify which of the determinants of demand or supply are affected. also indicate whether demand or supply increases or decreases. then draw a diagram to show the effect on the price and quantity of minivans.

a. people decide to have more children.
b. a strike by steelworkers raises steel prices.
c. engineers develop new automated machinery for the production of minivans.
d. the price of sport utility vehicles rises.
e. a stock market crash lowers people’s wealth.

You are the owner of a local honda dealership. unlike other dealerships in the area, you take pride in your “no haggle” sales policy. last year, your dealership earned record profits of $1.5 million. however, according to the local chamber of commerce, your earnings were 10 percent less than either of your competitors. in your market, the price elasticity of demand for midsized honda automobiles is 4.5. in each of the last five years, your dealership has sold more midsized automobiles than any other honda dealership in the nation. this entitled your dealership to an additional 30 percent off the manufacturer’s suggested retail price (msrp) in each year. taking this into account, your marginal cost of a midsized automobile is $11,000. what price should you charge for a midsized automobile if you expect to maintain your record sales?