Chapter 3: Q. 3.2 (page 49)
Discuss the difference between money prices and relative prices
Money prices are absolute while relative prices are in comparison to another.
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How could laws that ban tips cause a reduction in the quality of the delivery of services?
What direction might the supply of breakfast cereals have shifted to help explain why the market prices of these cereals have not changed very much during the past few years?
What do you predict has happened to oil storage prices
whenever shortages of storage space have arisen?
In Fig 3-2, the current position of the demand curve is D1, and the price of a portable power bank is $3. If there is an increase in the price of tablet devices that are complements to portable power banks, will the demand curve shift to D2 or to D3? What is the change in the amount of portable power banks demanded?
In Fig 3-4, the current position of the demand curve is D1, and the price of a portable power bank, which is a normal good, is $3. If there is an increase in consumer incomes, will the demand curve shift to D2 or to D3? What is the change in the amount of portable power banks demanded?
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