Final answer:
To find the new equilibrium price and quantity of movie downloads, we graph the original demand and supply from Table 3.10, then shift the demand curve left due to an increase in alternatives (nightclubs) and shift the supply curve right because of the elimination of a tax, and identify the new equilibrium where these curves intersect.
Step-by-step explanation:
The student's question concerns the equilibrium price and quantity of movie downloads in a market where both demand and supply are changing.
To identify the new equilibrium, we first graph the original demand and supply curves based on the initial information provided in Table 3.10.
Then, we adjust the demand and supply curves based on the changes: a decrease in demand due to the opening of nightclubs and an increase in supply as a result of the elimination of a tax on local entertainment businesses.
When the demand for movie tickets falls by six units at every price due to the new nightclubs, the demand curve shifts to the left.
Conversely, when the city eliminates a tax, resulting in a 10% increase in the quantity supplied of movies at any given price, the supply curve shifts to the right.
The equilibrium is found at the point where the new demand curve intersects the new supply curve. This intersection represents the new equilibrium price and quantity for movie tickets.
To calculate the exact changes, we would need the specific data points from Table 3.10 to plot the changes and determine the new equilibrium mathematically.
Since we don't have the table data, we can't provide specific numbers, but the methodology described is how one would go about finding the new equilibrium.