Exam 4: Demand and Supply

Millions of people from Mexico have migrated to the United States. This has reduced the supply of labor in Mexico and increased the supply of labor in the United States. Assume that the demand for labor in Mexico and the United States is unchanged. Then wages in the United States ________ and wages in Mexico ________.

Suppose over the next several years the productivity of firms producing electric cars improves dramatically. The advance in productivity leads to

If the demand curve for desktop computers shifts rightward and at the same time the supply curve shifts leftward, then

What leads to a decrease in the quantity demanded of a good or service?

-Which of the following events will increase the quantity demanded of bottled water?

Soft drinks and milk are substitutes for consumers. Draw a graph showing the effect of an increase in the price of milk on the demand for soft drinks.

Quantity demanded (tons of cat food per year) Price (dollars per pound of cat food) Quantity supplied (tons of cat food per year) 52 1.00 15 46 1.50 26 43 2.00 34 40 2.50 40 35 3.00 44 -The above table gives the demand and supply schedules for cat food. If the price is $1.00 per pound of cat food, will there be a shortage, a surplus, or is this price the equilibrium price? If there is a shortage, how much is the shortage? If there is a surplus, how much is the surplus? If $3.00 is the equilibrium price, what is the equilibrium quantity?

The market supply curve is the ________ of the ________.

When a surplus of rice occurs,

Quantity demanded (tons of cat food per year) Price (dollars per pound of cat food) Quantity supplied (tons of cat food per year) 52 1.00 15 46 1.50 26 43 2.00 34 40 2.50 40 35 3.00 44 -The above table gives the demand and supply schedules for cat food. If the supply increases by 20 tons at every price, what is the new equilibrium price and quantity?

The price of salsa rises. How does the increase in the price of salsa affect the supply of salsa?

The supply schedule

-New technology for producing plywood is developed. Which of the figures above best illustrates this change?

Suppose that the price of flour used to produce bagels increases. Hence the equilibrium price of a bagel ________ and the equilibrium quantity ________.

-In the figure above, a price of $15 per dozen roses results in

When the demand for a good decreases, its equilibrium price ________ and equilibrium quantity ________.

Two brands of water, Natural Water and Mountain Water, are close substitutes. If the price of Mountain Water decreases, the fall in price

A normal good is defined as a good

If the price of iPods decreases,

If the supply of iPods increases, then i) the supply curve for iPods has shifted rightward. Ii) the price of iPods has decreased. Iii) there will be a movement upward along the iPod supply curve.