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- What happens in the market for video games if the demand for video games increases by more than the supply of video games decreases? The equilibrium price will ________ and the equilibrium quantity will ________. A. rise; increase B. fall; increase C. not change; increase D. rise; decreasesolution plzThe market is the burger market. Production at a burger chain had been slow, but the owners invested in a new, fast cooking grill and fryer (a new technology). What do you expect to happen to the supply of burgers? A). Will the supply change (shift of the curve) of will the quantity supplied change (movement along the line)? Answer:______________________________________ B). If supply changes, will the curve shift to the right (increase in supply) or shift to the left (decrease in supply)? Please draw this on the graph above. C). If the supply changes, what is the factor or determinant affecting the change? If the curve did not shift, there is no determinant. Please see Supply/Demand Cheat Sheet...Hint: Natural Disasters, Price of inputs, technology, and expectations Answer:_____________________________________
- Which of the following is correct about equilibrium price after a shift in the supply curve to the right? 1. A price will decrease immediately after the shift. 2. A price will increase immediately after the shift. 3. There will be an excess supply at a higher level than equilibrium price, then the price will decline. 4. There will be no effect on prices. 392 7:04 PMIn year 1 the average price of X is $10, and in year 2 the average price of X is $23. If consumers buy more units of X in year 2 than in year 1, it follows that a. the law of supply does not hold for good X. b. demand for good X could be lower in year 2 than in year 1. c. supply of good X could be less in year 2 than in year 1. d. good X buyers have received an increase in income between year 1 and year 2, and good X is a normal good.Use the theory of the market (i.e. demand and supply) to explain what is happening in each of the following scenario Ensure that you discuss the impact on demand, supply, equilibrium price and equilibrium quantity (if any).
- 11. List basic determinants of increase in market supply. The supply increases when, (a) Resource or input prices: (increase, decrease) (b) Changes in technology: ( improvement, deterioration ) (c) Taxes: ( increase, decrease ) (d) Subsidies: ( increase, decrease ) (e) Prices of other related goods or products: ( increase, decrease ), if there is a substitution in production (f) Number of sellers: (increases, decreases )Other things constant, an improvement in overall technology that allows more output to be produced with the same level of inputs causes a movement up and along the supply curve, resulting in both a higher equilibrium price and quantity. a leftward shift of the supply curve but a fall in price and an increase in the quantity supplied. no movement of the supply curve but a fall in price and an increase in the quantity supplied. 3 a rightward shift of the supply curve so that more is offered for sale at every price.C- If the consumer income increases by 20%, what will happen to the equilibrium price and guantity.
- Draw the supply and demand curves based on the following schedules.Price Quantity Demanded Quantity Supplied$10 100 0$12 80 20$14 60 40$16 40 60$18 20 80$20 0 100 a. What is the market equilibrium price? b. From the Keynesian view, what condition will prevail at the price of $12?How about from the Classical view? c. Why Keynesians believe markets usually do not clear? d. Why Keynesians believe economies usually operate below their productionpossibilities frontierComplete the table by graphing the indicated hypothetical movements of demand and supply and state what then happens to both price and quantity. You can take the whole day to submit the output. D Question 1 50 pts Complete the table of the effects of simultaneous shifts in demand and supply by creating a graph for each scenario. Make sure to show the hypothetical graph for each number. Increase in Demand Decrease in Demand No change in Demand (rightward shift) (leftward shift) 1. P_ 4. P 6. P Q. Increase in Supply (movement to the right) No change in P or Q No change in Supply 2. P Q 7. P Q- Decrease in Supply 3. P Q 5. P Q 8. P. (movement to the left)explain why: a)the price of oil could have increased between 2004 and 2008. b) the price of oil could have fallen in 2008.
