Exam 3: Supply and Demand

Use the following to answer questions: Figure: Demand for Coconuts -(Figure: Demand for Coconuts) Look at the figure Demand for Coconuts. If coconuts are a normal good and the income level of consumers falls, it will be represented in the figure as a movement from:

Use the following to answer questions: Figure: Supply and Demand in the Orange Juice Market -(Figure: Supply and Demand in the Orange Juice Market) Look at the figure Supply and Demand in the Orange Juice Market. The market is in equilibrium at point C. Suppose most people drink orange juice only with champagne. What will be the new equilibrium point in the orange juice market if a law banning alcohol passes?

All of the following would result in an increase in the supply of a good EXCEPT:

A decrease in supply with no change in demand will lead to _____ in equilibrium quantity and _____ in equilibrium price.

Use the following to answer questions: Figure: The Demand and Supply of Wheat -(Figure: The Demand and Supply of Wheat) Look at the figure The Demand and Supply of Wheat. What is the equilibrium price in this wheat market?

Suppose the demand curve for good Z is downward-sloping. If the price of good Z decreases because of a shift in supply, this will cause:

Use the following to answer questions: Figure: The Demand and Supply of Wheat -(Figure: The Demand and Supply of Wheat) Look at the figure The Demand and Supply of Wheat. If there is an increase in demand of 2,000 bushels at each price, the equilibrium price and quantity will be _____ and _____ bushels, respectively.

Which of the following best exemplifies the law of demand?

Suppose you manage a corner grocery store. If peanut butter is an inferior good, what do you suppose would happen to the price and quantity sold of peanut butter as incomes fell during a recession?

Pizza is a normal good. If students' incomes at your college increase, the effect on pizza will be:

A newspaper story recently reported that the price of new cars, a normal good, has decreased and the quantity of new cars sold has dropped. The new price and quantity could have been caused by:

Use the following to answer questions: Figure: Four Markets for DVDs -(Figure: Four Markets for DVDs) Look at the figure Four Markets for DVDs. If D₁ or S₁ is the original curve and D₂ or S₂ is the new curve, which of the graphs shows a change that results in a decrease in the quantity of DVDs supplied?

In the local market for coffee, if Joyce's Java and Everyday Joe's coffee shops go out of business, the _____ curve shifts to the _____.

A decrease in supply is caused by:

Use the following to answer questions: -What is the difference between a shortage and scarcity?

An increase in the price of hamburger would probably result in _____ in the demand for hamburger buns.

Suppose the market for gasoline is in equilibrium. You have heard that the price of crude oil is falling because of new oil discoveries. You are also aware that the number of car and truck drivers is steadily rising. Knowing this, you predict that the price of gasoline will _____ and the quantity of gasoline bought and sold will _____.

An increase in the price of sugar (an ingredient for soft drinks) and an increased concern about tooth decay caused by the consumption of soft drinks will result in which of the following in the soft drink market?

If steak and potatoes are complements, when the price of steak goes up, the demand curve for potatoes:

If the supply and demand curves intersect at $14, then any price below that would result in: