Changes

1.  The supply of a good, and the demand for that good, determine both the ______ and ______ at which the good is sold (assuming it is a free market).

1.  The supply of a good, and the demand for that good, determine both the ______ and ______ at which the good is sold (assuming it is a free market).

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 (assuming a free market)?

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 a good or service increases, such 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 too many of that fruit and they are on the verge of rotting?  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.

5. When the New York Yankees built their new $1.5 billion ballpark, they made a decision about how many "obstructed view" bleacher seats to include.  Due to the design of this new stadium, people sitting in these bleacher seats could not see all of the field because part of the stadium structure blocks part of their view.  Here is what the supply and demand are for those obstructed-view seats:

5. When the New York Yankees built their new $1.5 billion ballpark, they made a decision about how many "obstructed view" bleacher seats to include.  Due to the design of this new stadium, people sitting in these bleacher seats could not see all of the field because part of the stadium structure blocks part of their view.  Here is what the supply and demand are for those obstructed-view seats:

(A) How many "obstructed view" bleacher seats did the New York Yankees build, based on the above data, and how much does the team make from sales of these tickets at each game?

(A) How many "obstructed view" bleacher seats did the New York Yankees build, based on the above data, and how much does the team make from sales of these tickets at each game?

<br>(B) Suppose the City of New York passed a law for a maximum price (a "price control") of $2 per "obstructed view" bleacher ticket.  Will the obstructed-view seats sell out under this law, and will people have to stand in long lines in order to buy them?  Would you oppose or support such a law, and why?

<br>(B) Suppose the City of New York passed a law for a maximum price (a "price control") of $2 per "obstructed view" bleacher ticket.  Will the obstructed-view seats sell out under this law, and will people have to wait in line in order to buy them?  Would you oppose or support such a law, and why?

6.  "Time is money."  Explain.  Or, as an alternative, improve on our definition of a "free market."  Or, as a third alternative, explain how the free market is so much powerful than even the wealthiest people in the world.

6.  "Time is money."  Explain.  Or, as an alternative, improve on our definition of a "free market."  Or, as a third alternative, explain how the free market is so much powerful than even the wealthiest people in the world.