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

If a union successfully negotiates for higher wages and benefits for steel workers, what impact would this have on supply and demand in the market for steel, assuming no other changes take place in this market?

If the demand for a product increases and the supply of the product does not change, equilibrium price and equilibrium quantity will both increase.

Figure 3-7 -Refer to Figure 3-7.Assume that the graphs in this figure represent the demand and supply curves for women's clothing.Which panel best describes what happens in this market when the wages of seamstresses rise?

Figure 3-8 -Refer to Figure 3-8.The graph in this figure illustrates an initial competitive equilibrium in the market for apples at the intersection of D₁ and S₁ (point A). If there is an increase in the wages of apple workers and an increase in the price of oranges, a substitute for apples, the equilibrium could move to which point?

Which of the following is the correct way to describe equilibrium in a market?

Auctions in recent years have resulted in higher prices paid for letters written by John Wilkes Booth than those written by Abraham Lincoln.What is a reason for this difference in price?

If, in response to a decrease in the price of grapes, the quantity of grapes demanded increases, economists would describe this as

Figure 3-7 -Refer to Figure 3-7.Assume that the graphs in this figure represent the demand and supply curves for rice.What happens in this market if buyers expect the price of rice to fall?

Tomas increased his consumption of potato chips when the price of pistachios increased.For Tomas, potato chips and pistachios are

Select the phrase that correctly completes the following statement."An increase in input prices caused a decrease in the supply of baseballs.As a result ________."

The supply curve for watches

Let D= demand, S = supply, P = equilibrium price, and Q= equilibrium quantity.What happens in the market for walnuts if the Centers for Disease Control and Prevention announces that consuming a half cup of walnuts each week helps to lower levels of bad cholesterol?

Figure 3-1 -Refer to Figure 3-1.A decrease in the price of the product would be represented by a movement from

Scarcity is defined as the situation that exists when the quantity demanded for a good is greater than the quantity supplied.

Figure 3-8 -Refer to Figure 3-8.The graph in this figure illustrates an initial competitive equilibrium in the market for apples at the intersection of D₁ and S₁ (point A). If the price of oranges, a substitute for apples, decreases and the wages of apple workers increase, how will the equilibrium point change?

The phrase "demand has decreased" means that

All else equal, as the price of a product falls, the quantity supplied increases.

Figure 3-8 -Refer to Figure 3-8.The graph in this figure illustrates an initial competitive equilibrium in the market for sugar at the intersection of D₁ and S₁ (point A). If there is an increase in the price of fertilizer used on sugar cane and there is a decrease in tastes for sugar-sweetened soft drinks, how will the equilibrium point change?

The demand by all the consumers of a given good or service is the ________ for the good or service.

If a decrease in income leads to a decrease in the demand for mac and cheese, then mac and cheese is