Econ unit 2 test

Which of the following pairs would appear on a market supply schedule used to create the market supply curve below?

$6.00 and 3,500 slices; $5.00 and 3,000 slices; $4.00 and 2,500 slices; $3.00 and 2,000 slices; $2.00 and 1,500 slices; and $1.00 and 1,000 slices.

Using the Market Demand Curve for Pizza below, how many slices of pizza per day would be demanded in this market if the price per slice of pizza was $3.50?

175 slices

When the government put rent control measures in place in order to hold down the rising prices on apartments in New York City, this was an example of what government effect on the market?

A Price Ceiling

When the government raises the minimum wage on the cost businesses must pay for labor, they are enacting what government means to affect the market?

A Price Floor

What happens to the demand curve when more people want to buy a game for their Nintendo Switch, no matter what price level the game is being sold for?

Answer: The Demand Curve will shift to the right.

A hardware store sells a pack of 6 Dynobrand light bulbs for $15 a pack. Dynobrand only supplies them with 20 packs per week at this price. The hardware store raises the price of the pack of light bulbs to $50 a pack and Dynobrand responds by sending them a supply of 50 packs per week. Using the graph below, which term best describes this situation?

Elastic

The Gonzalez family loves to go restaurant. Every Friday, for the last 3 years, they have visited out to eat at their favorite their favorite place. A month ago, the restaurant raised their prices. The Gonzalez family had to cut their visits from once a week to once every 3 weeks. Which term describes the Gonzalez' reaction to the price changes at their favorite restaurant?

Elastic. A change in price resulted in a big change in Demand for this family.

shift in either the supply or demand curve? What is true about equilibrium following

Equilibrium adjusts and is gradually restored afterwards as the market tends back towards equilibrium.

Apple prices are going higher more profits. They desire to produce even more apples to take advantage of this making apple producers excited at the thought of what they currently with this situation, which term would best describe their inability to respond in the have. If we were to measure these supplier's ability to deal planted and wait for them to mature to produce apples. They can only produce situation, but the problem is that it would take years for them to get more trees short term to these rising prices?

Inelastic

At a shoe store, this shoe is marked down from $49.99 to just $19.99 per pair. What signal does this send to a consumer?

It is a good time to buy when its on sale. There is a low opportunity cost.

The situation of Excess Supply, as seen in the graph below, would best be solved by doing what?

Lowering the price. This would result in an increase in the quantity being demanded along the demand curve and would cause a decrease in the quantity supplied along the supply curve. The new point would be closer to equilibrium.

In the graph you see the original supply curve shifting to the right (new supply). What does this mean?

Quantity Supply increased at each and every price.

If pizza is priced at $2.00 a slice, how would the market need to act to solve the problem of excess demand that exists at this price and move more towards equilibrium?

Raise the Price. When price is raised, quantity demanded will decrease and move towards equilibrium on the demand curve. Likewise, a higher price will encourage producers to increase the quantity supplied moving it towards equilibrium on the supply curve.

If Wrigley Gum changes the price of a pack of gum from $0.25 cents to $1.00 a pack, what would happen to the Demand Curve if graphing it?

Since it is a price change, only Quantity Demanded (QD) changes, where you move along the existing Demand Curve. There would be NO shift.

An unexpected winter storm damages the (remember to ask "who is affected first by what graphing problem would it be, Demand or Supply? and following the 3 steps of graphing, what type of Florida orange crop. If we were graphing this scenario, happening in the problem"?).

Supply. Producers need oranges to produce orange juice.

Looking at the following graph, what is the best evidence of the term equilibrium?

The point where Quantity Demand (QD) and Quantity Supplied (QS) both equal 200 slices of pizza at a price of $3.00 per slice.

The government passes regulations which raise the cost of production business who has to now purchase new equipment to comply with the government regulations. When this happens, what will be the result?

The supply curve will shift left and prices will increase.

where Supply itself above A wildfire in California has cost a major furniture producer their total supply of lumber. They have now gone out of business for good. Of the answers below, which one best describes the effect of this situation on the market?

The supply curve would shift left due to the non-price determinant variable of Change in the Number of Producers or Competitors.

When a company hires their 8th worker, according to this graph, what will be the result, or outcome?

They will experience a negative marginal product of labor compared to when they hired the 7th worker.

Severe frost strikes, killing the fruit seen in the picture below. What is the best description of what would happen in the market?

This would lead to disequilibrium in the market. Total supply would shift left leading to higher prices eventually.

What would happen in the following scenario: There is a Universities. What happens to the supply of college decline in the number of subsidies being received by graduates?

Total Supply would decrease and shift to the left due to a change in subsidies as the non-price determinant.

According to the Law of Supply, what will cause producers to increase production and supply a greater quantity of goods to the market?

rise or increase in prices.

decline market non-price consumers rise they would purchasing This is a term that means a way of allocating, or distributing (giving out) goods and services on a basis other than price. letting

An example: Instead of letting everyone buy a needed supply like lots of bottles of water before a Hurricane makes landfall, the store only allows 3 bottles per family. The bottles of water were sold in this way to make sure that everyone had a needed good. During normal times, someone with the most money could buy all the bottles they wanted as long as they had the money. This is an example of rationing when they limit how many, causing it to be distributed differently.

diup ani If you used this schedule to graph the total demand for watermelon at every price level, where would the equilibrium point appear?

At a price of $3.00 and a Quantity Demanded/Supplied of 200.

What would happen in the following incomes. What happens in the scenario: Inflation leads to a decline in the market for inferior purchasing power of individual's goods?

Change in Consumer Income, Feeling the instead would substitute inferior goods instead. This means goods due to the inflation (a general rise in prices) and income effect, consumers would look to This would be a Demand problem affected by the non-price determinant: stop buying their normal they would demand the cheaper, more affordable inferior goods while their purchasing power (ability to buy) is low. The demand curve would shift to the right.

In a market-based economy, prices act as a signal to both consumers and producers, telling consumers when the best time to buy

Low Prices are a green light to consumers to buy, but a red light to producers, telling them to sell their current supply, not necessarily make more. High Prices are a green light to producers to increase production to earn a higher profit, but a red light to consumers, indicating a high opportunity cost should they purchase a good or service.

If Katy, TX got a new Roast Beef Restaurant called Lion's Choice and it was competing with Arby's to serve Roast Beef Sandwiches, which direction would the supply curve shift due to the non-price determinant of "Change in the number of Competitors"?

More competition increases total supply. Supply curve will shift to the right.

Considering the Law of Demand and this diagram, what might be a reason why consumers would demand fewer quantities of pizza?

There is a price increase. The Law of Demand states when prices rise, the quantity demanded of a good decreases.

Equilibrium

demanded are in harmony with each other, or and is where quantity supplied and quantity A point that adjusts in response to market changes balanced, at a specific price.

Braph, the supply curve would shift to the left. When this happens, where would A business has seen the costs of their making it more expensive to produce factors of production (land, labor, and their product. capital) continue to rise, the new equilibrium be?

the existing demand curve would see Equilibrium re-establish itself above and to As Supply shifts left, the new intersect between the new Supply Curve and the left of the original equilibrium point.