Exam 4: Supply and Demand: an Initial Look

Two studies published in the New England Journal of Medicine link the risk of breast cancer to alcohol consumption. Young women who have nine drinks per week were reportedly 150 percent more likely to develop breast cancer. Considering the market for alcohol, an economist would predict a movement

Price floors are typically accompanied by a standard series of symptoms. What are they?

Professional baseball teams in the United States use only wooden bats. If aluminum bats were permitted, the impact on the wooden bat market would be

When price is above the equilibrium level, competitive price cutting will continue as long as quantity supplied exceeds quantity demanded.

If an increase in income leads to an increase in the demand curve for sailboats, this will lead to

Assume that Figure 4-16 shows the supply of orange juice. A decrease in the wage rate paid to workers in the orange juice industry will shift supply from

In January, 2,500 quarts of ice cream are sold in Boston at $2.50 a quart. In February, 3,000 quarts are sold at $2.00 a quart. This change in quantity sold and price may have been caused by

In 1971, the U.S. government banned cigarette advertising on radio and television. After the ban was imposed, an economist would predict that the price of magazine ads would

During the American Revolution, the Pennsylvania legislature enacted price controls on essential commodities. The result of this legislation was

Even though prices may change frequently, they can be expected to gravitate toward equilibrium.

Both demand and supply curves usually have positive slopes.

Black markets are frequent occurrence in markets with price ceilings.

A decrease in price of a certain good most likely will lead to

Scarcity and choice are the basic problems of economics; the supply and demand mechanism is the basic investigative tool of economics.

If oranges and grapefruit are close substitutes, an increase in the price of oranges will shift the demand curve of

Distinguish between demand and quantity demanded. Do the same for supply and quantity supplied.

Quantity supplied increases when the price of a good increases because

A decrease in the price of gasoline shifts the demand for auto batteries to the

List some of the problems that may arise when prices are controlled.

Which of the following would result in a decrease in demand for BMW automobiles?