Exam 3: Demand and Supply

Use the following to answer question(s): Shifts in Demand and Supply -(Exhibit: Shifts in Demand and Supply) Assume that the market in Panel (a) is in equilibrium at point M.Compared to the initial equilibrium at point N, what changes could explain what happened in this market?

List and explain the supply shifters.

Use the following to answer question(s): Demand Shifters and Supply Shifters -(Exhibit: Demand Shifters and Supply Shifters) The exhibit shows how supply and demand might shift in response to specific events.Suppose a wet and sunny year increases the nation's sweet corn crop by 20 percent.Which panel best describes how this will affect the market for frozen peas, a substitute for sweet corn?

Use the following to answer question(s): Demand Shifters and Supply Shifters -(Exhibit: Demand Shifters and Supply Shifters) The exhibit shows how supply and demand might shift in response to specific events.Suppose the technology for producing automotive gasoline improves.Which panel best describes how this will affect the market for automotive gasoline?

Use the following to answer question(s): The Demand for Chocolate-Covered Peanuts Quantity Demanded (bags per month) -(Exhibit: The Demand for Chocolate-Covered Peanuts) If the price of chocolate-covered peanuts increases from 40 cents to 50 cents, Dan will reduce his quantity demanded from 160 bags to 140 bags due to:

Use the following to answer question(s): Demand and Supply Curves -(Exhibit: Demand and Supply Curves) If there are no restrictions on the actions of buyers and sellers, the market price and quantity will tend toward ________ and ________ units, respectively.

Use the following to answer question(s): Demand and Supply-Determinants -(Exhibit: Demand and Supply-Determinants) The exhibit shows how supply and demand might shift in response to specific events.Suppose consumer incomes decrease.Which panel best describes how this will affect the market for used clothing, an inferior good?

An increase in the price of football tickets will cause the ________ for (of) basketball tickets (a substitute) to ________ .

Use the following to answer question(s): Demand and Supply Shifters -(Exhibit: Demand and Supply Shifters) The exhibit shows how supply and demand might shift in response to specific events.Suppose the price of lumber falls dramatically.Which panel best describes how this will affect the market for houses?

A market shortage occurs if the quantity:

Use the following to answer question(s): Simultaneous Shifts in Demand and Supply -(Exhibit: Simultaneous Shifts in Demand and Supply) D₁ and S₁ are original supply and demand curves, and S₂ and D₂ are new curves.In this market, the original equilibrium changed from point ________ to point ________ .

Use the following to answer question(s): The Market for Chocolate-Covered Peanuts -(Exhibit: The Market for Chocolate-Covered Peanuts) If the price of chocolate-covered peanuts is 50 cents, there is:

A market shortage occurs if the:

Use the following to answer question(s): Shifts in Demand and Supply -(Exhibit: Shifts in Demand and Supply) Which graph best illustrates what happened in the desktop calculators market when handheld calculators were invented and came on the market?

Given the events listed below that take place in the bread market, decide if demand changes or quantity demanded changes and determine the direction of change. a.The economy prospers and incomes increase dramatically. b.The price of bread falls. c.The price of flour, an ingredient of bread, falls. d.The price of bread increases. e.A severe weather problem occurs and most grain crops are destroyed. f.The price of potatoes, a substitute for bread, rises.

The price of oranges rises.What happens in the market for apples, which are a substitute for oranges?

A market surplus occurs if the quantity:

A decrease in price will lead to an increase in demand.

Use the following to answer question(s): The Demand for Music Downloads -(Exhibit: The Demand for music downloads) A decrease in the price of CDs (a substitute) would result in a change illustrated by:

An increase in consumer income will lead to an increase in supply.