Exam 3: Demand and Supply

Young drivers often buy used cars. An increase in the legal driving age to twenty-one would result in a leftward movement along the demand curve for used cars, whereas lowering the age to fifteen would result in a rightward movement along the demand curve.

A decrease in the expected future price of cars

When the price of a normal good falls, the substitution effect leads to ________ in the quantity purchased and the income effect leads to ________ in the quantity purchased.

Good A and good B are substitutes in production. The demand for good A increases so that the price of good A rises. The increase in the price of good A shifts the

-Pizza and hamburgers are substitutes for consumers. A fall in the price of a pizza ________ the price of a hamburger and ________ the quantity of hamburgers.

-You notice that the price and quantity of wheat both decrease. This observation can be the result of the

Peanut butter and jelly are complements for consumers. In 2015, the price of peanut butter increased. As a result, the ________ increased, which led to ________ in the price of jelly and ________ in the quantity of jelly.

What will happen to the equilibrium price and equilibrium quantity of ice cream cones when consumers' incomes decrease?

Which of the following does NOT shift the supply curve?

Bicycles are made out of steel. If the price of steel increases, there is a shift in the supply curve of bicycles that leads to

In the market for magazines, the "income effect" means that

If the price of a CD is equal to the equilibrium price, there will be ________ of CDs and the price will ________.

-Suppose the market for Blu-rays has the demand and supply schedules shown in the table above. Suppose a decrease in the price of a Blu-ray player increases the quantity of disks demanded at each price by 20 million. What are the new equilibrium price and equilibrium quantity of Blu-rays?

In 2015, the price of peanuts was rising, which led peanut butter buyers to expect the price of peanut butter would rise in the future. Consequently, in the current market for peanut butter there was ________ which resulted in ________ in the price of peanut butter and ________ in the quantity of peanut butter.

Which of the following explains why supply curves slope upward?

If the quantity demanded exceeds the quantity supplied, then there is

If income decreases or the price of a complement rises

Every spring, motorists do more driving than during the winter months. Every spring, the price of gasoline increases and the motorists buy more gasoline. This experience suggests that the

Leather belts and leather shoes are substitutes in production. If style changes increase the demand for leather belts, the supply curve of leather shoes will shift

For consumers, chocolate chip cookies and doughnuts are substitutes. So, an increase in the price of chocolate chip cookies will lead to a rightward shift in the demand curve for doughnuts.