Econ 300 HW

Farmers complain that they cannot make a living selling sugar at the current​ market-clearing price. They successfully lobby the government to initiate price controls on the sale of sugar. The government sets a price floor substantially above the equilibrium​ price, and no one is allowed to sell sugar for a price less than the price floor. As a​ result,

there will be a surplus of sugar

what is a durable good, paper towels or tv?

Tv's

for most industries supply is ??? in the short run than in the long run

less elastic

which of the following will cause the demand for kerosene heaters to increase

a decrease in the price of kerosene (compliment)

which one of the following would not occur if the market price was above the market clearing price

consumers would bid the price up

what happens to the market DEMAND curve if consumer income decreases

consumes demand a smaller quantity (shift left)

would you respect the price elasticity of demand to be larger in the short run or in the long run for paper towels why?

in the long run as new subsets enter the market

the price elasticity of demand for tv's should be larger

in the short run because tv's are durable

steel and aluminum are substitutes. if the price of steel increases, other things remain constant, we would except the price of aluminum to ??? and the equilibrium quantity of aluminum to ??

increase, increase

long run elasticity of demand differ from short run because

it takes time for people to change their consumption habits and it may take time for additional substitutes to become available

a shortage will develop because a price is set below market clearing levels firms will supply ?? than consumers wish to purchase

less

even though the annual consumption of copper is about 100 times greater than it was in 1880, the price of copper has remained relatively unchanged. what could cause this

more efficient technology reducing production cost, demand for copper grew dramatically, new deposits that were cheaper to mine were discovered

what would happen if the market SUPPLY if production costs decrease

production would shift to the rightt and producer a larger quantity

suppose that unusually hot weather causes the demand curve for ice cream to shift right. Why will the price of ice cream rise to a new market equilibrium? hot weather will..

shift the demand curve to the right, initially creating a shortage until the price rises to where the quantity supplied and demanded is equal again

regulation below market clearing level

shortage

how will setting the market price below the market clearing level affect a substitute

substitute price will rise because of increased demand

which one of the following would not cause the demand curve for coca cola to shift

the cost of producing coke increases (supply curve)