Running head: BABYSITTING AND BIRTHRATE
Babysitting and Birthrate
Joey D. Finley
March 22, 2011
Babysitting and birthrate
The small town of Middling experiences a sudden doubling of the birth rate. After three years,
the birth rate returns to normal. Use the graphs for each question, adding any arrows or other
indicators that you feel are necessary, to illustrate the effect of these events on the following.
1. What is the effect on the market for an hour of babysitting services in Middling today, during
this increased birthrate?
Explain the change, if any in the price of babysitting, and in both the
amount of babysitting demanded and supplied, giving your reasons for these changes. (10 points)
Having a doubling of birth rate or an increase in birthrate directly demands for
more babysitting to be done. A shift to the right in the demand curve will cause an increase in
demand at every price. This will cause an increase in the price of babysitting because of the
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