Session 6 Jeopardy

Determinants of Demand

100

If apples and oranges are substitutes, what happens to the demand for apples if the price of oranges increases? 

Demand for apples increases

200

What's the difference between inferior and regular goods? 

Demand for inferior goods goes down when your income goes up. Demand for regular goods goes up when your income goes up

300

Suppose all of the college students move back to Warrensburg after the summer is over. What happens for demand for textbooks? Which determinant of demand is effected? 

Demand increases, number of buyers 

400

If the price of Ford trucks is expected to rise next month, what happens to current demand? 

it increases

500

What are 3 determinants of demand? 

Income

Prices of related goods

Tastes/Preferences

Expectations of the future

#Of buyers

Demand Continued

100

What is the difference in a change in demand and a change in quantity demanded? 

A change in demand is a shift of the curve, a change in quantity demanded is a movement along the curve

200

Suppose a medical study comes out that Wendy's fast-food causes heart diseases. What happens to demand for Wendy's? Which determinant is this

It decreases, tastes and preferences 

300

If demand increases in a market, which direction does the demand curve shift? 

To the right 

400

What is the "Law of Demand" 

All things equal, when the price of something goes up, people want less of it 

500

True or False- An increase in price causes a decrease in demand 

False! It causes a decrease in QUANTITY demanded

Determinants of Supply

100

What happens to the supply of gas when a new gas station is built in town? 

Supply increases

200

Suppose the price of wood goes up. What happens in the market for wooden chairs?

Supply decreases

300

True/ False- Sellers will choose to sell less now if they expect prices to go up in the future 

True 

400

Would a technology innovation increase or decrease supply? 

Increase 

500

What are 3 determinants of supply? 

Input prices

Technology

Prices of Substitutes in production

Expectations of sellers

#of sellers in the market

Gains From Trade

100

The slope shows the opportunity cost of the good on which axis? 

Horizontal 

200

True/False- it is possible to have the comparative advantage in both goods 

False 

300

A country can either produce 4 cars or 2 houses. What is their opportunity cost of a house? 

2 cars 

400

A point that is outside of the PPF is called _______. 

Unattainable 

500

What's the difference between absolute and comparative advanatge? 

absolute- more with same input 

comparative- lower op cost