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

What is the difference between an "increase in supply" and an "increase in quantity supplied"?

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?

Figure 3-2 -Refer to Figure 3-2.An increase in the price of substitutes in production would be represented by a movement from

The law of demand implies,holding everything else constant,that

What are the two effects that explain the Law of Demand? Briefly explain each effect.

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

If,in the market for oranges,the supply has increased then

All else equal,a shortage of display screens used in the manufacture of tablet computers would

The supply curve for watches

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?

Which of the following will shift the demand curve for a good?

In January,buyers of gold expect that the price of gold will rise in February.What happens in the gold market in January,holding all else constant?

Blu-ray players were introduced to the market in 2006,and new technology has allowed for the cost of manufacturing the players to decline significantly since the initial introduction.How did this change in technology affect the market for Blu-ray players?

Ranchers can raise either cattle or sheep on their land.Which of the following would cause the supply of sheep to increase?

If a firm expects that the price of its product will be higher in the future than it is today

Figure 3-5 -Refer to Figure 3-5.In a free market such as that depicted above,a surplus is eliminated by

In 2004,hurricanes destroyed a large portion of Florida's grapefruit crop.How did this affect the market price and market quantity of grapefruit?

If a demand curve shifts to the right,then

In 2004,hurricanes damaged a large portion of Florida's orange crop.As a result of this,many orange growers were not able to supply fruit to the market.At the pre-hurricane equilibrium price (i.e.,at the initial equilibrium price),we would expect to see

What is the law of supply? What does this law imply about the shape of the supply curve?