Block 1 Review

What will happen to the equilibrium q of coffee, if an invasive insect eats half the crop in Brazil?

Steak Industry: What happens to p and q when there is an outbreak of Mad Cow Disease

If the government imposes a $5 price ceiling, a $2 price floor, $2 tax, and $3 subsidy on Oreos, what will the price?

The Law of Supply – as price goes up, the quantity supplied goes ___________.

Movement along the supply curve corresponds to __________________ changing. 

If a large change in price only leads to a small change in quantity demanded, the demand is

Price floors lead to

The price elasticity of demand is more elastic if the demand curve is closer to being __________.

Clothing Industry: Failed cotton crop driving up the cost of cotton fabric

Natural Gas Industry: Colder than expected winter

What causes a shift in the demand curve?  

Clothing Industry: Failed cotton crop driving up the cost of cotton fabric & cotton is discovered to be comfortable

Starting from free trade, when a tariff is applied to imports in a small country, which of the following increase?

Consumer surplus is

SUVs: Price of gas rises to $7 and autoworkers gain 10% pay increase

Ice cream: Science proves that ice cream cures depression & 10 million cows die

Tax incidence falls on the person who is ____________ elastic

Movement along the demand curve corresponds to __________________ changing. 

Lumber Industry: New regulations limit logging operations

Price ceilings lead to

Law of Demand- as price goes up, the quantity demanded goes:

Goods are compliments if a decrease in the price of one good

John gets a pay raise, an Economist would agree with which statement:

The government would like to increase the consumption of Almond Nut Juice. Which would be the most effective?

Brazil has a comparative advantage in producing coffee. What does that mean?