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

Select the phrase that correctly completes the following statement."A decrease in the expected future price caused an increase in the supply of smartphones.As a result

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

What are the two effects that explain the law of demand? Briefly explain each effect.

Suppose a positive technological change in the production of disease-resistant corn caused the price of corn to fall.Holding everything else constant,how would this affect the market for wheat (a substitute for corn)?

Which of the following would shift the supply curve for smartphones to the right?

What is the difference between a "change in demand" and a "change in quantity demanded"?

Last year,the Pottery Palace supplied 8,000 ceramic pots at $40 each.This year,the company supplied the same quantity of ceramic pots at $55 each.Based on this evidence,The Pottery Palace has experienced

Peanut butter and jelly are complements.If the price of peanut butter increases,the demand for jelly will increase.

Figure 3-5 -Refer to Figure 3-5.At a price of $15,the quantity sold

Use the following demand schedule for cherries to draw a graph of the demand curve.Be sure to label the demand curve and each axis,and show each point on the demand curve. Price (dollars per bushel) Quantity (thousands of bushels) 60 40 50 80 40 120 30 160 20 200

Table 3-4 Cashews Priceper lb. (dollars) Jordy's Quantity Demanded (lbs) Amy's Quantity Demanded (lbs) Rest af Market Quantity Demanded (lbs) Market Quantity Demanded (lbs) \ 10 1 1 50 8 2 3 70 6 3 5 95 4 5 9 128 2 8 14 156 -Refer to Table 3-4.The table above shows the demand schedules for cashews of two individuals (Jordy and Amy)and the rest of the market.At a price of $10,the quantity demanded in the market would be

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?

If,in response to an increase in the price of pineapples,the quantity of pineapples demanded decreases,economists would describe this as

A normal good is a good for which the demand increases as income decreases,holding everything else constant.

The income effect of a price change refers to the change in the quantity demanded of a good that results from a change in purchasing power as a result of the price change.

Prices of commercial airline tickets (assume that this is a normal good)have fallen in recent months.Over this same period,the price of jet fuel has risen and consumer incomes have fallen.Which of the following best explains the falling prices of airline tickets?

If the price of gasoline increases,what will be the impact in the market for public transportation?

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 increases and productivity increases. b.Income increases and the price of inputs decrease. c.The number of firms in the market decreases and income increases. d.Consumer preference increases and the price of a complement decreases. e.The price of a substitute in consumption decreases and the price of a substitute in production decreases.

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

If,in response to an increase in the price of chocolate the quantity of chocolate demanded decreases,economists would describe this as