In this chapter, you will learn to solve these economic puzzles: Why might government warehouses overflow with cheese and milk? What do ticket scalping and rent controls have in common? How does the spotted owl affect the price of homes? Inviting you refer. | Chapter 4 Markets in Action Key Concepts Summary Practice Quiz Internet Exercises ©2000 South-Western College Publishing * In this chapter, you will learn to solve these economic puzzles: How does the spotted owl affect the price of homes? Why might government warehouses overflow with cheese and milk? What do ticket scalping and rent controls have in common? * What can cause a shift in a Demand Curve? 1. Number of buyers in the market 2. Tastes and preferences 3. Income 4. Expectations of consumers 5. Prices of related goods * Return to previous slide while in slide show * $1200 $600 $300 4 8 12 16 D1 The Effects of Shift in Demand on Market Equilibrium D2 Shortage $900 S P Q * $40 $30 $10 10 20 30 40 D2 S D1 Surplus $20 The Effects of Shift in Demand on Market Equilibrium * Increase in Demand Increase in Equilibrium Price Increase in Quantity Supplied * Decrease in Demand Decrease in Equilibrium Price Decrease in Quantity Supplied * What can cause a shift in a Supply Curve? 1. Number of sellers in the market 2. Technology 3. Resource prices 4. Taxes and subsidies 5. Expectations of producers * $4 $1 20 40 60 80 D Surplus $3 $2 S1 The Effects of Shift in Supply on Market Equilibrium S2 * $800 $200 2 4 6 8 D Shortage $600 S1 S2 $400 The Effects of Shift in Supply on Market Equilibrium * Increase in Supply Decrease in Equilibrium Price Increase in Quantity Demanded * Decrease in Supply Increase in Equilibrium Price Decrease in Quantity Demanded * Can the Laws of Demand and Supply be repealed? In some markets, the objective of politicians is to prevent prices from reaching the equilibrium price * What are the two types of price controls? Price ceilings Price floors * What is a Price Ceiling? A legally established maximum price a seller can charge * $800 $600 $400 $200 2 4 6 8 D S Rent Control Results in a Shortage of Rental Units Shortage Rent ceiling P Q * Rent Ceiling Quantity Demanded exceeds the . | Chapter 4 Markets in Action Key Concepts Summary Practice Quiz Internet Exercises ©2000 South-Western College Publishing * In this chapter, you will learn to solve these economic puzzles: How does the spotted owl affect the price of homes? Why might government warehouses overflow with cheese and milk? What do ticket scalping and rent controls have in common? * What can cause a shift in a Demand Curve? 1. Number of buyers in the market 2. Tastes and preferences 3. Income 4. Expectations of consumers 5. Prices of related goods * Return to previous slide while in slide show * $1200 $600 $300 4 8 12 16 D1 The Effects of Shift in Demand on Market Equilibrium D2 Shortage $900 S P Q * $40 $30 $10 10 20 30 40 D2 S D1 Surplus $20 The Effects of Shift in Demand on Market Equilibrium * Increase in Demand Increase in Equilibrium Price Increase in Quantity Supplied * Decrease in Demand Decrease in Equilibrium Price Decrease in Quantity Supplied * What can cause a shift
