Exam 5: Using Supply and Demand

Stricter environmental regulations and increased demand for energy have caused an increase in the demand for relatively clean natural gas.In the last several years, improved extraction technologies and new discoveries have increased the availability of natural gas.What has been the net effect on price and quantity for natural gas?

A decrease in price and an indeterminate change in quantity are consistent with a:

The effect of successful compliance with recycling regulation by homeowners on the market for recycled paper along with a concurrent rise in demand for products made with recycled paper is best shown by a shift to the right in the supply of and demand for recyclable paper and a certain drop in its price.

Helped by desktop publishing, the number of vintage baseball card forgeries has flooded the market for vintage baseball cards.Dealers left the market for fear of purchasing a phony.What was the effect on the market for vintage baseball cards assuming phonies cannot be detected?

Trade sanctions imposed on Iraq that limited Iraq's production of oil after the 1990 Gulf War on the oil market are best shown graphically with a price ceiling below equilibrium price.

Given a downward sloping demand curve, a tax on the supply of a good will result in an increase in equilibrium price that is less than the amount of the tax.

What events most likely explain the following Wall Street Journal headline, "Cities Couldn't Give Away Their Trash; Now They Get Top Dollar?"

Refer to the graph shown.A quantity restriction of Q_R will:

Refer to the graph shown.If buyers must pay $5, quantity demanded will equal:

Suppose the price of tomatoes dramatically increases.Which of the following could cause this change?

When the polio vaccine first became available in the United States, the government controlled the price with an effective price ceiling.Production of the vaccine was not sufficient to fill all orders and the government had to regulate its distribution.Had the vaccine been sold without government intervention, the shortage would have been eliminated by price:

Refer to the graph shown that depicts a third-party payer market for prescription drugs.If the co-payment is $6 per pill, total expenditures under the third-party payer system will be:

Suppose a price floor is imposed on eggs above their equilibrium price.The likely result will be:

Online music stores such as Apple's iTunes provide an alternative to buying CDs.The introduction of online music stores has shifted:

Suppose that initially, the equations for demand and supply are Qd = 48 - 4P and Qs = 4P - 16, respectively.If the quantity demanded increases by 12 at every price (so that the demand curve shifts to the right), the equilibrium price will change from:

If the government imposes an excise tax on a good equal to $5 per unit and the demand curve for this good is vertical, the supply of this good will shift:

Refer to the table shown that depicts a third-party payer market.What is the price the supplier will charge for the quantity consumers demand if a $1 co-pay is established?

The most likely impact of an effective price floor is:

Suppose the equilibrium price of oranges is $0.79 an orange, but government takes steps to prevent the price from exceeding $0.60 an orange.The likely result will be a:

Refer to the graph shown.If government establishes a price floor of $7.25 per hour, there will be a: