Final answer:
When the introduction of the iPod and a tariff reduction occur simultaneously, the equilibrium price of Sony Walkman-type products is likely to decrease due to downward pressure from both a decreased demand and an increased supply. The effect on the equilibrium quantity is uncertain without specific data, as the decrease in demand and increase in supply have opposing effects.
Step-by-step explanation:
To determine the likely impact on the equilibrium price and quantity of Sony Walkman-type products when both the introduction of the iPod and a tariff reduction occur, we need to consider the supply and demand curves. The introduction of the iPod likely decreases the demand for Sony Walkman-type products as consumers prefer the newer technology. This shift is represented graphically by a leftward shift in the demand curve (D). Conversely, a tariff reduction on components used to manufacture the Walkman might lower production costs, increasing supply. This is shown as a rightward shift in the supply curve (S).
In economics, the equilibrium quantity is where the quantity supplied equals the quantity demanded, and the equilibrium price is the price at which this occurs. According to standard supply and demand analysis, a decrease in demand would normally lead to a lower equilibrium quantity and price, while an increase in supply would typically lead to a higher equilibrium quantity and a lower price.
When combining these two effects, the overall impact on the equilibrium price would likely be a decrease because both the reduction in demand and the increase in supply put downward pressure on price. However, the effect on quantity is ambiguous without specific data: the decrease in demand suggests a lower quantity, while the increase in supply suggests a higher quantity. The final effect on quantity would depend on the relative magnitudes of the shifts in the supply and demand curves.