Exam 4: Demand, supply, and Market Equilibrium

Figure 4.6 -Figure 4.6 illustrates a set of supply and demand curves for a product.When the economy moves from point B to point A,there has been:

Suppose that the population of a country decreases.Assuming that people in that country enjoy eating steak,we would predict that the equilibrium quantity of steak will ________ and the equilibrium price of steak will ________ in that country.

If a government creates an excess demand for a product by setting a maximum price,it is sometimes called a ________.

Figure 4.3 -Figure 4.3 illustrates the supply and demand for blue jeans.If the actual price of blue jeans is $30,we would expect the price of blue jeans to ________,the quantity demanded of blue jeans to ________,and the quantity supplied of blue jeans ________.

Suppose that the Surgeon General releases a study suggesting that steak consumption increases the risk of cancer.As a result of this study,we would predict that the equilibrium quantity of steak will ________ and the equilibrium price of steak will ________.

According to the Application,why might introducing sheep shearing not be an effective policy to raise wool prices?

The market demand curve shows the relationship between the price and the quantity demanded by all consumers,everything else being equal.

Figure 4.2 -Figure 4.2 depicts three market situations.Which of the panels depicts a market in which the price is likely to fall?

Using supply and demand analysis,the increase in the price of ice cream can be illustrated as:

Figure 4.4 -Figure 4.4 illustrates the demand for guitars.A successful advertising campaign to sell guitars would bring about a movement from:

Bananas and apples are substitutes.When the price of bananas falls and a technological advancement in apple production occurs at the same time:

Suppose that steak is a normal good.When income increases,the equilibrium quantity of steak will ________ and the equilibrium price of steak will ________.

Peaches and cream are complements.When the price of peaches rises,the equilibrium quantity of cream will ________ and the equilibrium price of cream will ________.

An increase in supply of a product results when:

If there is an advance in the technology used to produce a product,what is the likely effect it may have on the supply?

Hops are used to produce beer.If the price of hops decreases:

Suppose that in 2006,8 million cars were purchased at $15,000 each,while in 2007,10 million cars were purchased at $12,000 each.What might have caused this change?

Figure 4.4 -Figure 4.4 illustrates the demand for guitars.A decrease in price of guitars would bring about a movement from:

Suppose that the quantity supplied of cars exceeds the quantity of cars demanded.We would expect that:

________ occurs in a market when consumers are willing to buy more than producers are willing to sell,or can supply