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

In each of the following situations,list what will happen to the equilibrium price and the equilibrium quantity for a particular product,which is an inferior good. a.The population decreases and productivity increases b.The income increases and the price of inputs increase c.The number of firms in the market decreases and income decreases d.Consumer preference decreases and the price of a complement increases e.The price of a substitute in consumption increases and the price of a substitute in production increases

In the United States,consumption per-person of carbonated soft drinks ________ between 2005 and 2013.

A change in all of the following variables will change the market demand for a product except

Figure 3-4 -Refer to Figure 3-4.If the price is $10

Suppose that when the price of hamburgers decreases,the Ruiz family increases their purchases of ketchup.To the Ruiz family

If the number of firms producing mouthwash increases and consumer preference for mouthwash increases,the equilibrium price of mouthwash will definitely increase.

Figure 3-5 -Refer to Figure 3-5.At a price of $15

Assume that both the demand curve and the supply curve for MP3 players shift to the right but the demand curve shifts more than the supply curve.As a result

An inferior good is a good for which the quantity demanded decreases as the price increases,holding everything else constant.

An article in the Wall Street Journal in early 2001 noted two developments in the market for laser eye surgery.The first development concerned side effects from the surgery,including blurred vision.The second development was that the companies renting eye-surgery machinery to doctors had reduced their charges.In the market for laser eye surgeries,these two developments

What would happen in the market for knee replacement surgery if insurance companies started to cover a smaller portion of the cost of the surgery,and fewer doctors decide to enter the field of joint replacement surgery?

If the price of beef jerky rises,the substitution effect due to the price change will cause

Prices of smartphones (assume that this is a normal good)have fallen in recent years.Over this same period,the price of the components used to produce smartphones has also fallen and consumer incomes have risen.Which of the following best explains the falling prices of smartphones?

If an increase in income leads to in an increase in the demand for sushi,then sushi is

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?

An increase in the number of firms in a market will cause the quantity of a good supplied to increase.

If the price of propane-fueled gas grills was to decrease,then

As the number of firms in a market increases,the supply curve will shift to the right and the equilibrium quantity will rise.

Which of the following would cause the equilibrium price of white bread to decrease and the equilibrium quantity of white bread to increase?

Figure 3-2 -Refer to Figure 3-2.A decrease in the price of the product would be represented by a movement from