Economic Terminology
Demand Equation
Graphing
Shifters (Demand)
Equations
100
What causes a shift vs. movement along the demand curve?
Shift - External factors
Movement - Change in price
100
In a demand equation:
The income has a + or - sign
Normal: +
Inferior: -
100
What are the labels for the X and Y axis?
X-axis - Q
Y-axis - P
100
Peanut butter and jelly; milk and cereal; fries and ketchup are all examples of
Complements
100
Identify if this is a supply or demand equation:
Q = 20 + 10P
Supply
200
What is the study of the allocation of scarce resources among competing ends to satisfy unlimited wants and needs
Economics
200
In a demand equation:
The substitutes has a + or - sign
+
200
If the quantity demanded is 6, what is the price per unit?
$1 per unit
200
Give one example of an inferior and normal good.
Inferior: Top ramen, used cars, etc.
Normal: Eggs, steak, etc.
200
Identify if this is a supply or demand equation:
P = -90 - 4Q
Demand
300
What is the next best alternative?
Opportunity cost
300
Identify the incorrect signs in the following demand equation:
(Top ramen is an inferior good)
QD(Top ramen): -P(Top Ramen) + 6(Income) - 7(TP) + 5(Population) - 20
Incorrect Signs:
+ 6(Income)
300
Suppose you are looking at the Ford Truck market. The driving age becomes 18. What will happen to the Ford Truck market? Draw your answer.
Shift in
300
Name the shifter:
Selling Christmas trees in June.
Change in season
300
Identify if this is a price or quantity dependent equation:
P = -4 + 10Q
Price dependent
400
What is to add one additional unit
Margin/marginal
400
Identify the incorrect signs in the following demand equation:
(Wine is a normal good)
P(wine) = 4(QDwine) - 2Q(cheese) + 8(population) - 7(Income) + 2
Incorrect signs:
+4QD(wine)
-7(Income)
400
Suppose you are looking at the ground beef market. The price of ground beef increases. Show this change on a graph.
Change in movement of the demand curve.
400
Wine and beer; Chicken and steak; Pizza and hot dogs are all examples of
Substitutes
400
Identify if this is a price or quantity-dependent equation:
Q = 2P - 10
Quantity Dependent
500
The Law of Demand has a ____ relationship between quantity and price
Negative
500
Simplify this equation for milk:
QD(milk) = 5 - 6(Pmilk) + 2(Population) + 5(Income) + 3(TP)
Where:
Population = 4; Income = 2; TP = 1
QD(milk) = 26 - 6(Pmilk)
500
Suppose you are looking at the strawberry market. A strawberry is a normal good. Consumer income increases. What happens to the demand in the strawberry market? Draw your answer
Shift out
500
Name all 6 shifters that can be on a quiz.
Change in population, change in price of substitutes, change in price of complements, change in season, change in income, change in tastes/preferences
500
How do you identify whether an equation is price or quantity dependent?
How do you identify whether an equation is a supply or demand equation?
Explanations may vary.