Econ 1014 Exam 2 Study Guide

An increase in supply causes the supply curve to

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2) An increase in supply causes the supply curve to shift to the and is a decrease in the supply causes the supply curve to shift to the . a. Right; left b. Left; right c. Right; right d. Left; left e. None of the above. The direction of the shift is not predictable Unit 2: Section 7 Simultaneous Demand and Supply Changes 1) If you were planning a trip to Paris this year, you would find that air fares, hotel prices, and car rental prices are much lower if you travel from January to March than if you travel from June to August. Why is this? 2) If the demand for a product fell at the same time that the supply of the product ell, what would be the likely impact on the market for that product? 3) Suppose the price of gasoline in Columbia was $1.28 on Friday but had risen to $1.38 by the next Monday. Which of the following could account for this change in the market equilibrium price of gasoline? 4) Suppose gas prices risen to $5 per gallon by the end of the year. Which of the following could we expect to happen? a) A reduction in demand for gasoline b) A shift in the demand for gasoline to the left c) A reduction in the quantity of gasoline demanded d) An increase in the supply of gasoline; a shift of the supply curve to the left e) A reduction in the supply of gasoline; a shift of the supply curve to the left Unit 2 Section 8: Price Elasticity of Demand
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