3 Furby Mania - Supply and Demand Worksheet (1).pdf - Apply...

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Apply Economic Theories, Furby ManiaSupply and Demand WorksheetGraph 1The graph below shows supply and demand curves for the Furby market before Furby toys were popular.1a. What does the blue line represent? What does the red line represent?
1b. What is the space on the graph between the blue, green and red lines called? What does it represent?
Apply Economic Theories, Furby ManiaSupply and Demand WorksheetThe estimated equilibrium point would be 20$. It represents where the supply and
Graph 2Sketch a graph of supply-and-demand curves that depict the holiday season when the Furby craze took off, but Furby toys still retailed for $35. Use the same colors as above. Mark the area that represents the shortage with a green line.2a. Explain what changed between Graph 1 and Graph 2. Is the change in demand represented by a shift in the curve or a movement along the curve? What does this do to the equilibrium point?
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Apply Economic Theories, Furby ManiaSupply and Demand Worksheet2b. Explain what a shortage is. Does Graph 2 help explain why people bought $300 Furby toys? What does it show us?

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