Jeopardy Review Economics Test #2
Jeopardy Review Economics Test #2
Demand
100—Q: What does a market demand curve show?
A: All the quantities demanded by all people interested in purchasing a product at all reasonable price points.
200—Q: What does the “Law of Demand” state?
A: As an individual; as the price of a product increases, the quantity demanded goes down. As the price of a product decreases, the quantity demanded goes up.
300— Q: What are the 3 pieces needs in order to for there to be demand in the marketplace?
A: Desire, willingness, and ability.
400—Q: The “T” in our “T.I.R.E.S.” acronym for shifters of demand stands for what?
A: Taste
500—Q: How are demand and marginal utility related?
A: Marginal utility is the usefulness a consumer gets from using a product. As a consumer uses more of a product, their satisfaction goes down. This principle is the same idea as the “Law of Demand.” When there is more of a product available in the marketplace, people are willing to give up much less to get it.
Supply
100—Q: What is supply?
A: The quantity of a product that would be offered for sale, from a business, at all reasonable prices in the marketplace.
200—Q: Define and give a real world example of the “Law of Supply.”
A: The “Law of Supply” states that businesses will offer more products for sale at higher prices and less products at lower prices (high price = high quantity, low price = low quantity). As a producer of gum, Trident would like to offer the most possible gum to the marketplace at the highest possible price to gain the most profit.
300—Q: The second “S” in our supply shifters acronym stands for what? Give an example of this “S” causing a decrease in supply.
A: Subsidies/taxation. If a subsidy for small farmers is cut, their supply, or output, would decrease.
400—Q: A change in quantity supplied would result in what in the marketplace?
A: A change in price.
500—Q:Why do factors that cause a change in an individual’s supply also affect the market supply curve?
A: An individual, or in this instance, a business’s supply is just a smaller piece of the market supply. If one changes, so must the other.
Graphing
100—A
200—B
300—C
400—D
500—E
Miscellaneous
100—Q: Give an example in the real world where marginal utility influences a decision you have/could make.
A: Buying a soda: the first sip is great, every sip after gets less and less satisfying.
(Or) You will only buy one pair of the same sunglasses because every pair after the first becomes less and less useful.
200—Q: Give an example of a decision you have made using marginal analysis (Pollution activity).
A: Cleaning your room: how much of what you decide to clean based on the cost and benefit of cleaning one more unit of something.
300—Q: Why is there a heated debate over agricultural subsidies in our country?
A: There is very little evidence showing they produce change for small farmers. They are a very expensive program to run. Many non-farmers receive payments from the government. They could be run much more efficiently and effectively.
400—Q: In order for an item to be deemed “elastic” economists use three questions to conclude on the items responsiveness. What are those three questions?
A: Can the purchase be delayed? Are there substitutes available? Does the purchase of the item use a large portion of income?
500—Q: Based on our “In the Chips” simulation, how do prices evolve in the marketplace?
A: Prices all evolve towards equilibrium point (of quantity and price). This phenomenon is due to competition between buyers/sellers, sellers/sellers, and buyers/buyers. Prices exist to show people and businesses where they should buy and how much to produce.