Question 1

New oak tables are normal goods.What would happen to the equilibrium price and quantity in the market for oak tables if the price of maple tables rises,the price of oak wood rises,more buyers enter the market for oak tables,and the price of the glue used in the production of the new oak tables increased?

Accepted Answer

If the price of maple tables rises, some consumers may switch to buying oak tables instead, increasing the demand for oak tables. If the price of oak wood rises, the cost of production for oak tables will increase, leading to a decrease in supply. The entry of more buyers into the market for oak tables will also increase demand. The increase in the price of the glue used in production will also increase the cost of production, leading to a further decrease in supply. All these factors combined will lead to an increase in both the equilibrium price and quantity of oak tables.

Question 2

Figure 4-19
The diagram below pertains to the demand for turkey in the United States. 
-Refer to Figure 4-19.All else equal,the approach of Thanksgiving would cause a move from

Accepted Answer

As the approach of Thanksgiving would increase the demand for turkey, the demand curve would shift rightward from DS1 to DS2. As a result, the equilibrium price would increase from P1 to P2, and the equilibrium quantity would increase from Q1 to Q2. Therefore, the initial equilibrium point y would move to the new equilibrium point x, which lies on the intersect of the new demand curve DS2 and the initial supply curve S1. The movement would be from point B on DS1 to point A on DS2, which means that the new quantity demanded would be higher at the same price level. Thus, the answer is B.

Question 3

Figure 4-19
The diagram below pertains to the demand for turkey in the United States. 
-Refer to Figure 4-19.All else equal,a decrease in the price of the grain fed to turkeys would cause a move from

Accepted Answer

The answer of Figure 4-19
The diagram below pertains to the...

Question 4

Pens are normal goods.What will happen to the equilibrium price of pens if the price of pencils rises,consumers experience an increase in income,writing in ink becomes fashionable,people expect the price of pens to rise in the near future,the population increases,fewer firms manufacture pens,and the wages of pen-makers increase?

Accepted Answer

The answer of Pens are normal goods.What will happen to...

Question 5

Figure 4-19
The diagram below pertains to the demand for turkey in the United States. 
-Refer to Figure 4-19.All else equal,the premature deaths of thousands of turkeys would cause a move from

Accepted Answer

The answer of Figure 4-19
The diagram below pertains to the...

Question 6

Figure 4-19
The diagram below pertains to the demand for turkey in the United States. 
-Refer to Figure 4-19.All else equal,sellers expecting the price of turkey to rise in the future would cause a current move from

Accepted Answer

The answer of Figure 4-19
The diagram below pertains to the...

Question 7

What will happen to the equilibrium price and quantity of new cars if the price of gasoline rises,the price of steel rises,public transportation becomes cheaper and more comfortable,and auto-workers negotiate higher wages?

Accepted Answer

The increase in gasoline prices and improvements in public transportation make owning and using cars less attractive, reducing demand. The rise in steel prices and higher wages for auto-workers increase production costs, reducing supply. Both effects lead to a decrease in quantity. The price effect is ambiguous because the demand and supply shifts have opposing effects on price.

Question 8

New cars are normal goods.What will happen to the equilibrium price of new cars if the price of gasoline rises,the price of steel falls,public transportation becomes cheaper and more comfortable,auto-workers accept lower wages,and automobile insurance becomes more expensive?

Accepted Answer

The answer of New cars are normal goods.What will happen...

Question 9

Figure 4-19
The diagram below pertains to the demand for turkey in the United States. 
-Refer to Figure 4-19.All else equal,a sale on chicken would cause a move from

Accepted Answer

The answer of Figure 4-19
The diagram below pertains to the...

Question 10

Figure 4-19
The diagram below pertains to the demand for turkey in the United States. 
-Refer to Figure 4-19.All else equal,a large number of people becoming vegetarians would cause a move from

Accepted Answer

The answer of Figure 4-19
The diagram below pertains to the...

Question 11

Figure 4-19
The diagram below pertains to the demand for turkey in the United States. 
-Refer to Figure 4-19.All else equal,an increase in the productivity of turkey farmers would cause a move from

Accepted Answer

The answer of Figure 4-19
The diagram below pertains to the...

Question 12

What would happen to the equilibrium price and quantity of lattés if the cost to produce steamed milk,which is used to make lattés,increased,and scientists discovered that lattés cause heart attacks?

Accepted Answer

The answer of What would happen to the equilibrium price...

Question 13

Figure 4-19
The diagram below pertains to the demand for turkey in the United States. 
-Refer to Figure 4-19.All else equal,buyers expecting turkey to be more expensive in the future would cause a current move from

Accepted Answer

If buyers expect turkey to be more expensive in the future, they will increase their current demand for turkey, resulting in a shift from D_B to D_A. This is because the higher expected price of turkey in the future increases the current perceived value of turkey, leading to an increase in current demand.

Question 14

What would happen to the equilibrium price and quantity of peanut butter if the price of peanuts went up,the price of jelly fell,fewer firms decided to produce peanut butter,and health officials announced that eating peanut butter was good for you?

Accepted Answer

The answer of What would happen to the equilibrium price...

Question 15

Which of the following sets of events must cause an increase in the price of a new house?

Accepted Answer

- Higher wages for carpenters will increase the cost of building a new house, which will lead to an increase in the price of a new house. 
- Higher wood prices will increase the cost of raw materials for building a new house, which will also lead to an increase in the price of a new house. 
- Increases in consumer incomes mean that people will have more money to spend, which can increase demand for new houses and drive up their price. 
- Higher apartment rents can make buying a new house more attractive, increasing demand and price. 
- Increases in population mean that there are more potential buyers for new houses, which can increase demand and drive up prices. 
- Expectations of higher house prices in the future can lead to speculation and bidding wars, which can also drive up the price of new houses.

Question 16

What would happen to the equilibrium price and quantity of lattés if coffee shops began using a machine that reduced the amount of labor necessary to produce steamed milk,which is used to make lattés,and scientists discovered that coffee prevents heart attacks?

Accepted Answer

The answer of What would happen to the equilibrium price...

Question 17

Consider the market for new DVDs.If DVD players became cheaper,buyers expected DVD prices to fall next year,used DVDs became more expensive,and DVD production technology improved,then the equilibrium price of a new DVD would

Accepted Answer

The answer of Consider the market for new DVDs.If DVD...

Question 18

Figure 4-19
The diagram below pertains to the demand for turkey in the United States. 
-Refer to Figure 4-19.All else equal,an increase in the income of buyers who consider turkey to be an inferior good would cause a move from

Accepted Answer

The answer of Figure 4-19
The diagram below pertains to the...

Question 19

What would happen to the equilibrium price and quantity of lattés if coffee shops began using a machine that reduced the amount of labor necessary to produce steamed milk,which is used to make lattés,and scientists discovered that lattés cause heart attacks?

Accepted Answer

The reduction in labor necessary to produce steamed milk will lower the cost of production for lattés, leading to a lower equilibrium price. However, the discovery that lattés cause heart attacks will decrease the demand for lattés, leading to a decrease in equilibrium quantity. The net effect on equilibrium quantity is ambiguous without further information.

Question 20

What will happen to the equilibrium price and quantity of traditional camera film if traditional cameras become more expensive,digital cameras become cheaper,the cost of the resources needed to manufacture traditional film falls,and more firms decide to manufacture traditional film?

Accepted Answer

The increase in the price of traditional cameras and the decrease in the price of digital cameras will lead to a decrease in demand for traditional camera film, which will cause a decrease in the equilibrium price of traditional camera film. However, the decrease in the cost of resources needed to manufacture traditional film and the increase in the number of firms manufacturing it will lead to an increase in the supply of traditional camera film, which will cause an increase in the equilibrium quantity of traditional camera film. Therefore, the effect on quantity is ambiguous while the price will fall.

Quiz 4: The Market Forces of Supply and Demand

Figure 4-19 The diagram below pertains to the demand for turkey in the United States. -Refer to Figure 4-19.All else equal,the approach of Thanksgiving would cause a move from

Figure 4-19 The diagram below pertains to the demand for turkey in the United States. -Refer to Figure 4-19.All else equal,a decrease in the price of the grain fed to turkeys would cause a move from

Figure 4-19 The diagram below pertains to the demand for turkey in the United States. -Refer to Figure 4-19.All else equal,the premature deaths of thousands of turkeys would cause a move from

Figure 4-19 The diagram below pertains to the demand for turkey in the United States. -Refer to Figure 4-19.All else equal,sellers expecting the price of turkey to rise in the future would cause a current move from

What will happen to the equilibrium price and quantity of new cars if the price of gasoline rises,the price of steel rises,public transportation becomes cheaper and more comfortable,and auto-workers negotiate higher wages?

New cars are normal goods.What will happen to the equilibrium price of new cars if the price of gasoline rises,the price of steel falls,public transportation becomes cheaper and more comfortable,auto-workers accept lower wages,and automobile insurance becomes more expensive?

Figure 4-19 The diagram below pertains to the demand for turkey in the United States. -Refer to Figure 4-19.All else equal,a sale on chicken would cause a move from

Figure 4-19 The diagram below pertains to the demand for turkey in the United States. -Refer to Figure 4-19.All else equal,a large number of people becoming vegetarians would cause a move from

Figure 4-19 The diagram below pertains to the demand for turkey in the United States. -Refer to Figure 4-19.All else equal,an increase in the productivity of turkey farmers would cause a move from

What would happen to the equilibrium price and quantity of lattés if the cost to produce steamed milk,which is used to make lattés,increased,and scientists discovered that lattés cause heart attacks?

Figure 4-19 The diagram below pertains to the demand for turkey in the United States. -Refer to Figure 4-19.All else equal,buyers expecting turkey to be more expensive in the future would cause a current move from

What would happen to the equilibrium price and quantity of peanut butter if the price of peanuts went up,the price of jelly fell,fewer firms decided to produce peanut butter,and health officials announced that eating peanut butter was good for you?

Which of the following sets of events must cause an increase in the price of a new house?

What would happen to the equilibrium price and quantity of lattés if coffee shops began using a machine that reduced the amount of labor necessary to produce steamed milk,which is used to make lattés,and scientists discovered that coffee prevents heart attacks?

Consider the market for new DVDs.If DVD players became cheaper,buyers expected DVD prices to fall next year,used DVDs became more expensive,and DVD production technology improved,then the equilibrium price of a new DVD would

Figure 4-19 The diagram below pertains to the demand for turkey in the United States. -Refer to Figure 4-19.All else equal,an increase in the income of buyers who consider turkey to be an inferior good would cause a move from

What would happen to the equilibrium price and quantity of lattés if coffee shops began using a machine that reduced the amount of labor necessary to produce steamed milk,which is used to make lattés,and scientists discovered that lattés cause heart attacks?

What will happen to the equilibrium price and quantity of traditional camera film if traditional cameras become more expensive,digital cameras become cheaper,the cost of the resources needed to manufacture traditional film falls,and more firms decide to manufacture traditional film?