Exam 4: Demand,supply,and Market Equilibrium

Suppose that in 2016,8 million cars were purchased at $25,000 each,while in 2015,10 million cars were purchased at $22,000 each.What might have caused this change?

People will buy more of an inferior good when their incomes decrease.

Figure 4.4 -Figure 4.4 illustrates the demand for guitars.An increase in price of guitars would bring about a movement from

In considering the relationships between price and quantity demanded,ceteris paribus means economists assume that

Figure 4.4 -Figure 4.4 illustrates the demand for guitars.Assume that guitars and guitar strings are complements.An increase in the price of guitar strings would bring about a movement from

A normal good is defined as a good for which demand decreases when

Recall the Application about the decrease in price of illegal drugs in the United States to answer the following question(s). -According to the Application,what did Ted Koppel identify as the explanation for why (illegal)drug prices have been dropping?

What is the difference between an "individual demand curve" and a "market demand curve"?

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 ________.

A decrease in the amount of subsidies that a public university receives would result in

If incomes increase and hotdogs are inferior goods,then

Assume that chicken and beef are substitutes.When the price of beef increases,

Figure 4.5 -Figure 4.5 illustrates the supply of guitars.If the government offered a subsidy to guitar manufacturers for each guitar they produce,this would most likely cause a movement from

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 price of fertilizer,an input in the production of corn,rises.We would predict that the equilibrium quantity of corn will ________ and the equilibrium price of corn will ________.

Figure 4.1 -Refer to Figure 4.1 that shows Mary and Tom's individual demand curves for meals per week at Fratelli's Italian Restaurant.Assuming Mary and Tom are the only consumers in the market,if the market quantity demanded is 3,the price must be

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

Between an "individual demand curve" and a "market demand curve," which one has a steeper slope?

Suppose that a market for a product is in equilibrium at a price of $5 per unit.At any price above $5 per unit

Recall the Application about the policies used by the European Union to support the agricultural sectors of is member countries to answer the following question(s). -According to the Application,we can infer that the wine lakes will disappear if