Review Questions Chapter 3

Review Questions Chapter 3 - Chapter 3 Review Questions...

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Chapter 3 Review Questions
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Problem 1.7 page 90 State whether each of the following events will result in a movement along the demand curve for McDonald’s Big Mac hamburgers or whether it will cause the curve to shift. If the demand curve shifts, does it shift to the left or the right? a. The price of Burger King’s Whopper hamburger declines. b. McDonald’s distributes coupons for $1 off the purchase of a Big Mac c. Because of a shortage of potatoes, the price of French fries increases. d. KFC raises the price of a bucket of fried chicken. e. The US economy enters a period of rapid growth in incomes.
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Problem 3.3 Page 92 Briefly explain whether you agree with the following statement: “When there is a shortage of a good, consumers eventually give up trying to buy it, so the demand for the good declines, and the price falls until the market is finally in equilibrium.”
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Problems 4.12 and 4.13 Page 94 (4.12) Briefly explain whether each of the following statements is true or false. a. If the demand and supply for a product both increase, the equilibrium quantity of the product must also increase. b. If the demand and supply for a product both increase, the
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Review Questions Chapter 3 - Chapter 3 Review Questions...

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