Exam 4: The Market Forces of Supply and Demand

Most markets in an economy are:

When there is a shortage in a market:

For each of the following situations in the Australian crocodile market, determine whether the quantity supplied changes, or whether the supply curve shifts and determine the direction of the change. a. the number of crocodile farms and ranches closes, ceteris paribus b. Professor Webb develops an antibiotic that ensures more hatchlings survive on ranches c. the cost of meat to feed crocodiles rises d. Thailand announces it is going to increase the number of crocodile farms in the next five years

It is not possible for demand and supply to shift at the same time.

Graph each of the following changes and explain what would happen to equilibrium price and quantity. 1. demand increases and supply increases 2. demand increases and supply decreases 3. demand decreases and supply decreases 4. demand decreases and supply increases

Graph 4-6 -Refer to the Graph 4-6. At a price of $20:

Which of the following would cause both the equilibrium price and equilibrium quantity of number-two-grade potatoes (an inferior good) to increase?

Graph 4-1 -Refer to Graph 4-1. The movement from point A to point B on the graph would be caused by:

When large areas of the US Pacific North-West were protected from logging in 1990 (to conserve spotted owl habitat), this is likely to have caused the equilibrium price of logs to increase and the equilibrium quantity of logs sold to decrease.

A reduction in an input price will cause a change in quantity supplied, but not a change in supply.

To represent the effect of a price increase for coffee:

The quantity demanded of a product is the amount that buyers are willing and able to purchase at a particular price.

A table showing how the quantity supplied of a product varies with its price, other things being equal, is a supply schedule and the graph of the supply schedule is called a supply curve.

A market with just one seller is said to be a monopoly.

A supply curve slopes upward because:

Graph 4-6 -Refer to the Graph 4-6. If price were $15, quantity supplied would be:

Demand for fish is higher in India than Australia because:

If sellers are price makers, then individually:

A weaker demand together with a stronger supply would necessarily result in:

Suppose that demand for black market koala skins increases AND supply decreases because of falling koala populations. What would happen in the black market for koala skins?