Answer:
Explanation:
1.(graph attached)
Initially, the cheese pizza market is at equilibrium at point A: Price = P1, Quantity = Q1
If the population of California drops, it affects the number of people demand for cheese pizza negatively. So that in the market of cheese pizza, the demand curve would shift to the left.
The market moves to the new equilibrium at point B: Price = P2, Quantity = Q2
As P2 < P1, Q2 < Q1 so that the price goes down and the quantity also goes down.
=> Answer: C
2.
When average American's real take home pay increases - the real income of consumers increases, the demand for consumer electronics products would also increase as these are normal goods.
In the electronics market, the demand curve shifts to right, leading to the higher price and quantity demanded of electronic products.
So that the shifter is the budget - the consumer income of the consumers.
=> Answer: A
3. When average American's real take home pay increases - the real income of consumers increases, the demand for consumer electronics products would also increase as these are normal goods.
In the electronics market, the demand curve of electronics shifts to the right. The market moves to the new equilibrium. The price is higher, the quantity demanded is also higher.
So that price and quantity go up.
=> Answer: A
4.
If people wanting to buy new home believe that the price of new homes will continue to decrease, it means that the consumers' expected future prices decrease.
This would lead to the shifting to the right of the demand curve in the market for home, resulting in higher price and higher demand.
So that in this case, the shifter is what affecting the demand curve to shift - which is the consumer expectation of future price.
=> Answer: C
5. (graph attached)
If people wanting to buy new home believe that the price of new homes will continue to decrease, it means that the consumers' expected future prices decrease.
Initially, the home market is at equilibrium at point A: Price = P1, Quantity = Q1.
When the consumers' expected price for home decrease, the demand curve for new home would shift to the right.
The market moves to the new equilibrium at point B: Price = P2, Quantity = Q2.
As P2 > P1, Q2 > Q1, the price and quantity go up.
=> Answer: A
6.
When using world class athletes to promote the products, the product brand awareness in the public would increase.
When the products is highly aware of by the public, it would shift the demand curve for breath mints to shift to the right, resulting in higher price and higher quantity demanded.
So that the shifter in this case is what leads to the shift of the demand curve - which is the consumer taste and advertising.
=> Answer: E
7.
If the college tuition becomes more affordable - it means that the price for higher education decreases.
In the higher education market, as the tuition fee is the price and higher education is the product. So that when the price decreases, it would lead to a downward movement along the demand curve and the supply curve would remain unchanged.
So that in this case, there is no shift in the market.
=> Answer: F
8.
If the college tuition becomes more affordable - it means that the price for higher education decreases.
In the higher education market, as the tuition fee is the price and higher education is the product. So that when the price decreases, it would lead to a downward movement along the demand curve.
This would result in the lower price and the higher quantity.
=> Answer: D
