Supply and Demand Shifters and Circular Flow in Economics

New technology advances the rate at which furniture can be assembled. Why does this change the supply?

• Change in cost of production

• Changes in number of producers

• Changes in expectations

Graph shows which of the following?

(actually use this graph to answer the question)

• a decrease in demand (shift) and a decrease in quantity supplied

• a decrease in demand (shift) and a decrease in supply

• a decrease in quantity demanded and a decrease in quantity supplied

• a decrease in quantity demanded and a decrease in supply (shift)

Assume the image is showing the market for apples. Which of the headlines could indicate the pictured shift is occurring in the market?

• Pesticides on apples linked to mouth cancer.

• Storms destroy apple orchards.

• An apple a day really does keep the doctor away.

• New genetic strain leads to apple trees that produce twice as many apples.

Which of the following is NOT a determinant of the supply of peanut butter?

• The price of peanuts

• The wages of peanut butter factory workers

• The income of peanut butter consumers

• Existing peanut butter making technology

Which of the following will cause an increase in demand for snowboards?

• More costly production methods

• A decrease in the price of lift tickets at resorts in Colorado

• A decrease in consumer income

• A decrease in the population

What does a “surplus” (extra amount) of goods in a market imply?

• Prices are too high

• Prices are too low

• Supply is too low

• Demand is too high

Americans revive their love of SUV’s and the newly remodeled, but still “gas guzzling” Hummer. What happens to the market for gasoline?

• Demand for gasoline will decrease

• Demand for gasoline will increase

• Demand for gasoline will stay the same

In an attempt to increase the production of oil and gasoline, Congress and the President have given the okay to drill in the Alaskan Arctic Preserve. What happens to the market for gasoline?

• Supply for gasoline will decrease

• Supply for gasoline will increase

• Supply for gasoline will stay the same

Which of the following defines "Complementary Goods?"

• Goods that can be used to replace the purchase of similar goods when prices rise

• Goods that are commonly used with other goods

• Goods that are independent of other markets

If only the price for a good or service changes, does the demand curve shift? Why or why not?

• Yes, Price shifts the demand curve to the right because less people are being goods

• Yes, Price shifts the demand curve to the left because more people are buying goods

• No, Because price does not shift the curve. Price stays on the line

• No, becasue price does not impact the points on the curve

• Yes and No. The price shifts the curve sometimes, but not always