ANSWER TO TRY IT! PROBLEM Without a third-party payer for education, the graph shows equilibrium tuition of P1 and equilibrium quantity of education of Q1 State support for education lowers tuition that students pay to P2 As a result, students demand Q2 courses per year To provide that amount of education, educational institutions require tuition per course of P3 Without a third-party payer, spending on education is 0P1EQ1 With a third-party payer, spending rises to 0P3FQ2 Figure 4.18 4.4 Review and Practice Summary In this chapter we used the tools of demand and supply to understand a wide variety of market outcomes We learned that technological change and the entry of new sellers has caused the supply curve of personal computers to shift markedly to the right, thereby reducing equilibrium price and increasing equilibrium quantity Market forces have made personal computers a common item in offices and homes Attributed to Libby Rittenberg and Timothy Tregarthen Saylor URL: http://www.saylor.org/books/ Saylor.org 223