ECON101 Lecture Notes - Lecture 7: Frozen Yogurt, Complementary Good, Marginal Cost

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carmineplatypus987

3 Nov 2018

School

University of Waterloo

Department

Economics

Course

ECON101

Professor

Nafeez Fatima

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ECON101 Lecture 6: IMG_2970

ECON101 Lecture Notes - Lecture 7: Frozen Yogurt, Complementary Good, Marginal Cost

ECON101 Lecture 8:

Document Summary

Change in quantity demanded: change in price and movement along the curve. Change in demand causes entire curve to shift as opposed to movement along the curve and is. Change in demand: curve moves to the right. Whe(cid:374) de(cid:373)a(cid:374)d i(cid:374)(cid:272)reases right(cid:449)ard shift of the (cid:272)ur(cid:448)e. De(cid:373)a(cid:374)d de(cid:272)reases left(cid:449)ard shift of the (cid:272)ur(cid:448)e. Ho(cid:449)e(cid:448)er, (cid:449)he(cid:374) pri(cid:272)e does(cid:374)"t (cid:272)ha(cid:374)ge, o(cid:374)ly de(cid:373)a(cid:374)d (cid:272)ha(cid:374)ges. A positive relationship exists between supply and quantity supplied holding everything else constant. Represented by 1. supply schedule 2. supply curve. Change in quantity supplied: due to change in price, and is a movement along the curve. Price of factors of production (higher the price, lower the supply) The number of supplies (number of supplier increases, the supply, too, increases) State of nature (favourable climate causes supply to increase) Supply is a positive relationship between price and quantity supplied holding everything else constant triple bottom line: planet profit should be the sole goal (not part of neoclassical economic profit though)

Related Questions

1.Brian receives more utility from two apples than from one apple. However, the amount of extra utility provided decreases with each additional apple. This example illustrates which of the following:

a. Scarcity

b. Utility maximization

c. Inelastic demand

d. Diminishing marginal utility

2.A listeria outbreak recently hit the US cantaloupe industry, resulting in decreased consumer demand for cantaloupe. How is this demand decrease reflected on the demand curve?

a.Inward shift of the demand curve

b.Outward shift of the demand curve

c.Upward movement along the demand curve

d.No change in the demand curve

3.The price of beef increases, resulting in decreased consumer demand for beef. How is this demand decrease reflected on the demand curve?

a.Inward shift of the demand curve

b.Outward shift of the demand curve

c.Upward movement along the demand curve

d.No change in the demand curve

4.A 1% increase in the price of cereal leads to a 2% decrease in consumer demand for cereal. Which of the following best describes the own-price elasticity of cereal?

a.Inelastic

b.Unitary elastic

c.Elastic

5.The slope of the demand curve for salt is ________the demand curve for steak.

a.Steeper than

b.The same as

c.Flatter than

6.The price of butter decreases from $3/lb to $2/lb. The quantity demanded of butter increases from 2lbs to 3.5lbs. What is the own-price elasticity of butter?

a.-1.27

b.-2.25

c.-2.50

d.-1.49

7.The price of crackers increase from $2/box to $2.5/box. Demand for cheese decreases from 1.5/lbs to 1/lb. Which of the following best describes the relationship between crackers and cheese?

a.Complements

b.Unitary

c.Substitutes

d.Inelastic

8.A householdâs income decreases from $50,000/year to $40,000/year. The householdâs demand for steak decreases from 20/lbs to 15/lbs per year. What is the income elasticity of demand for steak?

a.1.25

b.0.76

c.0.25

d.1.00

9.Morton decides to increase the price of its salt from $1/lb to $1.5/lb. How will this price increase affect sales?

a.Sales of salt will increase

b.Sales of salt will remain the same

c.Sales of salt will decrease

10.Haagen Dazs decides to increase the price of its ice cream from $5/pint to $7/pint. How will this price increase affect sales?

a.Sales of Haagen Dazs ice cream will increase

b.Sales of Haagen Dazs ice cream will remain the same

c.Sales of Haagen Dazs ice cream will decrease

The substitution effect of a price change refers to
A) the change in quantity demanded that results from a change in price making a good more
or less expensive relative to other goods that are substitutes.
B) the shift of a demand curve when the price of a substitute good changes.
C) the movement along the demand curve due to a change in purchasing power brought
about by the price change.
D) the shift in the demand curve due to a change in purchasing power brought about by the
price change.