Exam 4: Supply and Demand: an Initial Look

A demand curve can be thought of as

Assuming that the demand curve for cookies is downward sloping, if the price of cookies falls from $1.50 to $1.25 per dozen,

There is general agreement among economists that rent controls cause shortages of housing, but despite this rent controls continue to persist. Why does this occur?

An individual's demand schedule

A surplus occurs when price is higher than the market equilibrium.

In the 1990s, Congress considered an agriculture bill that would gradually reduce price supports for many agricultural products. If the bill were to be approved, what would most likely happen to the number of families employed in agriculture?

Suppose that in a free market, 2,000 patients purchase an operation to receive an artificial heart at a price of $500,000 per operation. Without the heart, each patient will die. The government decides this price is too high and imposes a maximum price of $200,000. Everything else equal,

Assume that Figure 4-4 shows demand for orange juice. A decrease in the price of apple juice will change demand from

The following are the equations for the supply and demand curves in the market for weezils: where Q _d is the quantity demanded, Q _s is the quantity supplied, and P is the price per weezil in dollars. Refer to Exhibit 4-1. If consumers decide that they want 20 percent fewer weezils at every price, the equation for the new demand curve for weezils will be

Refer to Table 4-1. What is the equilibrium price in the example above?

Consumer income changes can shift market demand.

A price ceiling is only effective if it is above the market equilibrium.

The price of natural gas fell and the quantity sold also fell. Everything else being equal, it is consistent that

Rent controls are most often designed to protect the investment made by apartment building owners.

The United States typically experiences a large surplus of milk annually. This is caused by

When price is below the equilibrium level, there is a shortage of the commodity being sold.

A cold winter will increase the quantity of heating fuel demanded at every price.

If both the supply and demand curves shift to the left, then we can conclude that there will be

Which of the following events would result in an increase in the demand for electricity, causing the demand curve to shift outward?

Suppose demand can be described with the equation Q = 900 − 5P and supply with the equation Q = 100 + 5P. Complete the following table. Determine the equilibrium price and quantity.