Exam 3: Where Prices Come From: the Interaction of Demand and Supply

Let D = demand, S = supply, P = equilibrium price, Q= equilibrium quantity. What happens in the market for tropical hardwood trees if the governments restrict the amount of forest lands that can be logged?

If the price of smartphones was to increase, then

Select the phrase that correctly completes the following statement. "A decrease in the number of manufacturers caused a decrease in the supply of sailboats. As a result,

If in the market for peaches, the supply curve has shifted to the left,

The market for smartphones has become very competitive. The increase in competition in this market is an example of how the market responds to

From a supply perspective, what impact would an increase in the price of motorcycles have on the market for motorcycles?

Figure 3-8 -Which of the following statements is true?

If the price of peaches, a substitute for plums, decreases, the demand for plums will increase.

Figure 3-1 -Buyers rush to purchase stocks in California vineyards following a forecast of a 30 percent decline in this year's grape harvest. What happens in the California wine market as a result of this announcement?

Draw a supply and demand graph showing an equilibrium price of $50 and an equilibrium quantity of 200 units. Explain what would happen if the selling price was $75, and illustrate this on the graph. Explain what would happen if the selling price was $25, and illustrate this on the graph. Be sure to label each axis and curve on the graph.

Orange juice drinkers want to consume more orange juice at a lower price. Which of the following events would have this effect?

Which of the following would shift the supply curve for MP3 players to the right?

Peanut butter and jelly are complements. If the price of peanut butter increases, the demand for jelly will increase.

The popularity of digital cameras has enticed large discount stores like Wal-Mart and Costco to offer digital photo printing services. How does this affect the digital photo printing market?

The law of demand implies, holding everything else constant, that