复习 - 第二单元 - 1. Supply and Demand Curve

Question 1

Q1

S和D的变化的答题套路

Answer 1

1. 定角度，when Q stays unchanged 或者 P stays unchanged
2. 分析情况会导致另外一个变量怎么变
3. 因此线是 shift down/up；或者shift to the left/right
4. 小尾巴, all else equal

Question 2

Q2

S和D的变化的答题套路练习：
If tax on producer impact

Answer 2

1. 定角度。例如 when quantity supplied stays unchanged,
2. With tax, producers have to pay extra money to the government. This is equivalent to higher cost. Therefore producers have to charge a higher price.
3. As a result, the supply curve shifts up (S往上移动）
4. , all else equal

Question 3

Q3

决定Supply的”变量“是什么

Answer 3

Cost

Question 4

Q4

how to explain that the supply curve is upward sloping?

Answer 4

• Quantity supplied ↑ ➪ Extra cost ↑ ➪ Price charged ↑

Question 5

Q5. 价格 Price

• 对于consumer来说，price是什么
• 对于producer来说，price是什么

Answer 5

• price willing to pay / willingness to pay
• price charged

Question 6

Q6. How to explain that the demand curve is downward sloping?

Answer 6

Quantity demanded ↑ ➪ Extra satisfaction ↓ ➪ Willingness to pay ↓

Question 7

Q7. What are the difference between the following

1. quantity demanded increases
2. Demand increases

Answer 7

1. movement downwards along the demand curve
2. the demand curve shifts up or the right

Question 8

Q8. What are the difference between the following

1. quantity supplied increases
2. Supply increases

Answer 8

1. movement upwards along the supply curve
   
   1. the supply curve shifts up or the right

Question 9

Q9.

Definition:

The market demand refers to….

Answer 9

the sum of all individual demand for a product.

Question 10

Q10. Definition:

Demand refers to ….

Answer 10

the willingness and the ability of customers to pay a given price to buy a good or service.

Question 11

Q11. Definition:

Quantity demanded refers to

Answer 11

the amount of a good or service demanded at each price level

Question 12

Q12. Definition:

The law of demand states there is an ________ relationship between the _______________ and the __________.

The higher the price of a product, the lower its demand tends to be

Answer 12

inverse; price of a good or service; quantity demanded

Question 13

Q13. the demand curve is downward sloping because people have different taste and preference

a. true
b. false

Answer 13

b. false.

The demand curve is downward sloping because the extra satisfaction people get, hence the price they are willing to pay, decreases with quantity consumed

People will have different demand curves because of different taste

Question 14

Q14. If there is an increase in quantity demanded in burgers

1. Has people’s income risen?
2. what drives the increase in quantity demanded?

Answer 14

1. No. Factors other than price willing to paid are constant along the same demand curve
2. The price of burgers

Question 15

Q15 使得demand curve shifts的几个因素，缩写是什么？这些缩写具体都是什么？

Answer 15

HIS AGE

• Habits, tastes and fashions.
• income levels
• Substitutes and complements (price and availability).
• advertising
• policy
• economy

Question 16

Q16 Definition：

Supply refers to ….

Answer 16

the ability and willingness of firms to provide goods and services at given price levels.

Question 17

Q17 Definition:

Quantity supplied refers to….

Answer 17

the amount of a good or service supplied at each price level

Question 18

Q18 Definition:

The market supply refers to ….

Answer 18

the sum of all individual supply for a product.

Question 19

Q19 Definition:

The law of supply says there is a _______ relationship between __________________

The higher the price of a product, the higher its supply tends to be

Answer 19

positive;

price and the quantity supplied of a product

Question 20

Q20. If there is an increase in quantity supplied in cell phones

1. Has people’s income risen?
2. Are there new entrants in the cell phone market?
3. Is there a new iPhone being released?

Answer 20

1. Input prices have not changed. Factors other than production costs hence price charged are constant along the same supply curve
2. No. Factors other than production costs hence price charged are constant along the same supply curve
3. No. Factors other than production costs hence price charged are constant along the same supply curve

Question 21

Q21. If there is an increase in quantity supplied in cell phones

1. has input price increased?
2. has production costs increased?
3. what drives the increase in quantity supplied?

Answer 21

1. no. Input prices have not changed. Factors other than production costs hence price charged are constant along the same supply curve
2. Yes. 注意，我们说 production cost随着Qs ↑ ，也越来越高，原因是lower efficiency（而不是input原材料的价格上涨了）。
3. Price charged

Question 22

Q22 What are the factors deteriming supply?

Answer 22

TWO TIPS

• Time
• Weather
• Opportunity cost of production options (price of other goods)
• Taxes
• Innovations
• Production costs
• Subsidies