Exam 4: Demand, Supply, and Market Equilibrium

Recall Application 3, "The Supply and Demand for Cruise Ship Berths," to answer the following questions: -Based on the application, a severe recession (all else equal) would cause the equilibrium price of cruise ships berths to:

If incomes increase and Honda Civics are considered normal goods, then

Rent control is an example of the government imposing:

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?

If an increase in income results in an increase in the demand for Honda Civics, then Honda Civics are considered:

Suppose that the government requires that farms use only animals instead of machinery when planting and harvesting corn. This will result in a/an:

If a computer company will sell a laptop only if the price is $400 or higher, then $400 is known as:

Figure 4.6 -Figure 4.6 illustrates a set of supply and demand curves for a product. If the good were inferior and the consumer's income decreases, then this can be illustrated as moving from point:

Two goods are substitutes if:

Suppose that a technological advancement substantially reduces the cost of producing cheese. We would predict that the equilibrium quantity of cheese will _______ and the equilibrium price of cheese will _______.

When consumers have a choice between products and they see an increase in the price of the brand they normally buy, they will purchase a _______ product.

People will buy more of an inferior good when their income decreases.

Explain how an excess demand would lead to an increase in prices in an unregulated market.

Which of the following is the most likely complement for hamburgers?

Excess supply in an unregulated market will cause the price of a product to fall.

Recall Application 5, "Droughts in Australia and the Price of Rice," to answer the following questions: -The adoption of new technologies used for rice production in response to the high rice prices will ultimately cause the shift of the:

The market supply curve is:

Which of the following can increase the number of pizzas a seller is willing to sell at a given price?

Explain how an excess supply would lead to a decrease in prices in an unregulated market.