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What is the terminology for this definition below?
Prices rise because more goods and services are trying to be purchased than the economy can produce
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- Which of the following is the best explanation of why the price adjusts following an increase in supply? Price adjusts automatically when supply changes. At the initial price, there will be a surplus after supply increases. Price must fall until the quantity demanded and quantity supplied are equal again. At the initial price, there will be a shortage after supply increases. Price must fall until the quantity demanded and quantity supplied are equal again. At the initial price, there will be a shortage after supply increases. Price must rise until the quantity demanded and quantity supplied are equal again. At the initial price, there will be a surplus after supply increases. Price must rise until the quantity demanded and quantity supplied are equal again.Demand for cookies is of the following form: P=20-4QD, where QD is millions of cookies demanded per year and P is price in US dollars. Supply of cookies of the following form: P=6+Qs, where QS is millions of cookies supplied per year and P is price in US dollars. a. What is the equilibrium quantity of cookies traded? Solve the equation, showing your work. b. Graph the supply and demand curves, marking their intersection. Be sure to label intercepts, equilibrium, etc. c. The government imposes a tax of $2 per cookie on producers of cookies. What is the new equilibrium quantity of cookies traded? Solve the equation, showing your work. d. In a graph, show how the supply curve has shifted. What price do consumers now pay? After paying the tax, how much to producers receive.The following table shows the annual demand and supply in the market for shoes in Miami. Price (Dollars per pair of shoes) 20 40 60 80 PRICE (Dollars per pair of shoes) 120 100 20 On the following graph, plot the demand for shoes using the blue point (circle symbol). Next, plot the supply of shoes using the orange point (square symbol). Finally, use the black point (plus symbol) to indicate the equilibrium price and quantity in the market for shoes. Note: Plot your points in the order in which you would like them connected. Line segments will connect the points automatically. 0 100 0 Quantity Demanded (Pairs of shoes) 1,100 900 800 200 600 500 400 600 800 QUANTITY (Pairs of shoes) Quantity Supplied (Pairs of shoes) 200 400 500 900 1000 1,200 1200 O Demand Supply Equilibrium
- Consider the following scenarios. Think about how each scenario would affect the price of khaki pants. A new technology reduces the time it takes to make a pair of khaki pants. The price of the cloth used to make khaki pants falls. The wage rate paid to garment workers increases. The price of jeans increases. People's incomes increase. Assignment: Address the following statements related to the scenario above. Does each event change demand, supply, both, or neither? Explain your choice. Does the event increase or decrease demand and/or supply? Explain your answer. How does this change in demand and/or supply affect the equilibrium prices and quantity within the market? Part 2 Compare the new demand curve or supply curve by drawing it on a graph Find the new equilibrium and compare it with the original one in terms of equilibrium price and quantity and explain your findingsConsider the market for pizza in a large city. Assuming that pizza is a normal good. Identify what happens to the equilibrium price and quantity after the price of labor falls: The equilibrium price is expected to increase, the equilibrium quantity is expected to increase. The equilibrium price is expected to increase, and the equilibrium quantity is expected to decrease. The equilibrium price is expected to decrease, and the equilibrium quantity is expected to decrease. The equilibrium price is expected to decrease, the equilibrium quantity is expected to increase.Why would a shift in supply or demand happen as a result in a market equilibrium with higher prices but lower sales volume?
- Complete the following table by selecting the term that matches each definition. Definition The claim that, other things being equal, the quantity supplied of a good increases when the price of that good rises The amount of a good that sellers are willing and able to supply at a given price A graphical object showing the relationship between the price of a good and the amount that sellers are willing and able to supply at various prices A table showing the relationship between the price of a good and the amount of it that sellers are willing and able to supply at various prices PRICE (Dollars per Record) 20 18 Apply your understanding of the previous key terms by completing the following scenario with the appropriate terminology. 16 14 12 10 8 4 Your professor claims that one of the curves found on the following graph correctly illustrates the supply curve for records: 2 0 0 $₂ S 1 1 2 6 7 3 5 QUANTITY (Millions of Records) 4 Quantity Supplied 8 9 10 Supply Curve O (?) O O Supply…Scenario 2: The Ministry of health publishes a study finding that coffee drinking reduces the probability of getting cancer. How do you imagine this will affect the market for coffee? Why? Which determinant of demand or supply is being affected? Explain. Show graphically the changes in demand or supply. Will this change the equilibrium price and quantity of coffee? Explain your reasoning.In Jonesville, the market price and equilibrium quantity demanded of ice cream drops every year in May. This phenomenon: Violates the law of demand. When the price decreases, people should always buy more. Can be explained by a decrease in demand, from college students departing the area in the summertime. Can be explained by an increase in demand, as more people want ice cream in the summertime. None of the above explanations is consistent with the scenario described. Can be explained by an increase in supply, as ice cream trucks start to roam more frequently in the summertime.
- A drought in the Midwest has reduced the production of wheat used to make cereal. At the same time, the national price of milk (a compliment good) has increased. Given these two effects, what will happen to the current equilibrium quantity and price of cereal?The following graph shows the market for cars in 2007. Between 2007 and 2008, the equilibrium price of cars remained constant, but the equilibrium quantity of cars decreased. From this, you can conclude that between 2007 and 2008, the supply of cars and the demand for cars Adjust the graph to illustrate your answer by showing the positions of the supply and demand curves in 2008. Note: Select and drag one or both of the curves to the desired position. Curves will snap into position, so if you try to move a curve and it snaps back to its original position, just drag it a little farther. PRICE (Dollars per car) QUANTITY (Cars) Supply Demand Demand O Supply ?Begin with the market for chocolate in equilibrium. What will happen to the equilibrium price of chocolate if producers and consumers expect the price of chocolate to rise in the future? Will the equilibrium price of chocolate increase, decrease, or stay the same if producers and consumers expect prices to rise in the future? A increase B decrease C) stay the same
