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''You can post answers here: [[Economics Homework 2 Answers]]''

''You can post answers here: [[Economics Homework 2 Answers]]''

<br>One miracle is mentioned in all four Gospels of the Bible: the multiplication of the loaves and fish by Jesus to feed the crowd of thousands.  It illustrates God easily '''''overcoming''''' a scarcity in food.  Similarly, the devout Puritans overcame scarcity and created wealth under harsh conditions in New England in the early 1600s.  Scarcity is no problem for God, but it can be a huge problem for those who turn away from God.

<br>{{Economics_Lectures}}

One miracle is mentioned in all four Gospels of the Bible: the multiplication of the loaves and fish by Jesus to feed the crowd of thousands.  It illustrates God easily '''''overcoming''''' a scarcity in food.  Similarly, the devout Puritans overcame scarcity and created wealth under harsh conditions in New England in the early 1600s.  Scarcity is no problem for God, but it can be a huge problem for those who turn away from God.

Economics is the study of the '''''transfer''''' of goods and services.  What determines the '''''price''''' and '''''quantity''''' of goods transferred?  How much must a buyer pay in order to acquire the good (the price), and how many units of the good (the quantity) will the seller be able to sell at that price?

Economics is the study of the '''''transfer''''' of goods and services.  What determines the '''''price''''' and '''''quantity''''' of goods transferred?  How much must a buyer pay in order to acquire the good (the price), and how many units of the good (the quantity) will the seller be able to sell at that price?

2. Suppose the price demand curve for a particular good is P = $30 - Q, where P is the price and Q is the quantity.  Also suppose the price supply curve is P = $6 + Q.  At which price and quantity will the good be sold?

2. Suppose the price demand curve for a particular good is P = $30 - Q, where P is the price and Q is the quantity.  Also suppose the price supply curve is P = $6 + Q.  At which price and quantity will the good be sold?

3. When the '''''supply''''' of a good or service increases, such as increasing the number of oil wells, what happens to the market price of oil?  Explain.  When the '''''demand''''' for a good a good or service increases, such more people driving cars that need gasoline (refined oil), what happens to the market price of oil?  Explain.

3. When the '''''supply''''' of a good or service increases, such as increasing the number of oil wells, what happens to the market price of oil?  Explain.  When the '''''demand''''' for a good or service increases, such as more people driving cars that need gasoline (refined oil), what happens to the market price of oil?  Explain.

4. Why do grocery stores lower the price of their fruit (such as grapes) when they have an oversupply of ripened fruit?  Explain by citing the downward slope of a demand curve, and describe what happens to this fruit after the grocery store lowers its price.

4. Why do grocery stores lower the price of their fruit (such as grapes) when they have an oversupply of ripened fruit?  Explain by citing the downward slope of a demand curve, and describe what happens to this fruit after the grocery store lowers its price.

|$8

|$8

|300 (the low sales price => low supply)

|300 (the low sales price => low supply)

|1200 (the low sales prie => high demand)

|1200 (the low sales price => high demand)

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