Chapter 3A. Additional Examples of Supply and Demand

Chapter 3AAdditional Examples of Supply and DemandCopyright © 2015 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.LettuceSupply shifts left for lettuceWeather destroys part of the cropDemand doesn’t changeConsumers still want as much lettuce as beforeEquilibrium price rises which will reduce the quantity demandedLO7Exchange RatesExchange rates are the price of one country’s currency in terms of another country’s currencyCurrency appreciationCurrency depreciationLO7Pink SalmonSupply shifts right for pink salmonNew technologyNew fishers enter the industryDemand shifts left for pink salmonIncreases in consumers’ incomeReductions in the price of substitutesLO7GasolineSupply of gasoline decreasesRefinery breakdownsMideast politics and warfareRising price of oilDemand for gasoline increasesConsumers’ incomes increasedLow mileage SUVs popularLO7SushiSupply shifts rightIncrease in the number of sushi barsDemand shifts rightConsumers’ tastes for sushi increasesLO7Land in San FranciscoVertical supply curveQuantity supplied fixed and unresponsive to price changesDemand increase causes price to rise but quantity stays the sameDemand decrease causes price to fall but quantity stays the sameExplains high real estate prices in citiesLO7Preset PricesPreset prices can cause market imbalancesOlympics figure skating finalsPreset price results in a shortage of ticketsOlympics curling preliminariesPreset prices result in a surplus of ticketsLO7