Chapter 3: Q. 1 - For Critical Thinking (page 70)
What do you predict has happened to oil storage prices
whenever shortages of storage space have arisen?
Rise.
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In fig 3-7, what are the effects of a price increase from \(2 per portable power bank to \)4 per portable power bank on the quantities supplied by supplier 1 and by supplier 2 individually and combined?
In Fig 3-9, the current position of the supply curve is S1, and the price of a portable power bank is $3. If the cost of inputs that suppliers utilize to produce portable power banks decreases, will the supply curve shift to S2 or to S3? What is the change in the amount of portable power banks supplied?
In fig 3-7, what are the effects of a price decrease from \(5 per portable power bank to \)3 per portable power bank on the quantities supplied by supplier 1 and by supplier 2 individually and combined?
Consider the market for smartphones. Explain whether the following events would cause an increase or a decrease in supply or an increase or a decrease in the quantity supplied. Illustrate each, and show what would happen to the equilibrium quantity and the market price.
a. The price of touch screens used in smartphones declines.
b. The price of machinery used to produce smartphones increases.
c. The number of manufacturers of smartphones increases.
d. There is a decrease in the market demand for smartphones.
Why do you suppose that prices of barbecued brisket have been rising in
many U.S. cities?
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