Chapter 5 Supply

5(1) Understanding Supply
Identify
Supply
Law of Supply
Quantity Supplied
Supply Schedule
Variable
Market Supply Schedule
Supply Curve
Market Supply Curve
Elasticity of Supply
everything is elastic over time

Look at figure 5.1 (101)  How is the law of supply different than the law of demand?

Look at the picture (102)  What causes different genres of music to be created?

Look at figure 5.2 (103)  What does the chart say about the pizzeria owners decisions?

Look at figure 5.5 (105) If a  supply is inelastic, how will supply react to a small increase in price?

Look at the oranges on 106?  Why is its supply inelastic, but its demand is elastic?

5(1)  questions on page 106: ____________________________


5(2)  Costs of Production
Identify
marginal product of labor
increasing marginal costs
diminishing marginal returns
fixed cost
variable cost
marginal cost
marginal revenue
operating cost

Look at figure 5.6 (109) Why does marginal product of labor decrease after the 3rd bean bag chair?

Look at figure 5.7.  What is the difference between increasing, diminishing, and negative marginal returns?


What example is given in the fast fact (110)?

Look at figure 5.8  Identify examples of  fixed and  variable cost?

Look at 5.9(111)  Why is marginal revenue always $24?

Look at  5.10 (112) Why does the marginal cost curve look like a check?

Why is the shuttered factory pictured on page 114?

5.2 Questions   Group   _____________________________________











5.3 Changes in Supply
Identify
Subsidy
excise tax
regulation

Look at 5.12 (117)   Which graph shows the effects  of higher costs?  Left or Right

Read Global Connections (118) How did EU subsidies lead to a wine lake and a butter mountain?

Look at the picture (118)  Who does the French government subsidize?  Why when food is cheaper from other sources?

Why is the windmill farm pictured on page 119?

Look at the picture on page 120.  Why does inflation lead to shortages?

5(3)  Questions  Group ______________________________

Chapter 4

4(1)  Understanding Demand  (79-
Define: 
demand
law of demand
substitution effect
income effect
demand schedule
market demand schedule
demand curve

Look a figure 4.1  What does the law of demand say about lower prices?

Look at figure 4.2  What two effects does it show?

What two types of demand schedules are shown on figure 4.3?

Section 1 questions  Group_______________________

4(2)  Shifts in Demand Curve
Define:
ceteris paribus
normal good
inferior good
complements
substitutes

What is pictured on page 85?

Look at 4.6  What is shifting?

What inferior good is pictured on page 86?

What expectation pictured on page 87 changed demand?

What complementary goods are pictured on page 88?

Section 4(2) questions :  Group  _______________________

4(3)  Elasticity of Demand
Define:
elasticity of demand
inelastic
unitary elastic
total revenue

Read Global connections (91)  What caused a change in the Indian government in 1988?

Look at the picture on page (93) Which demand is inelastic and which is inelastic?  Why?

Look at the picture (94)  How are economic conditions reflected in the two car advertisements?

Look at the 4.8 revenue table?  At what individual price do you think a pizzeria could maximize its revenue?  Why? Remember complementary products to pizza.

Look at figure 4.9 (96) How does revenue signal elasticity?

Section 4(3) questions   Group  _____________________

Chapter 3 homework

Vocabulary for Chapter 3

3(1)
profit motive
open opportunity
legal equality
private property rights
free contract
competition
interest group
public disclosure laws
public interest

3(2)
macroeconomics
microeconomics
GDP
business cycle
work ethic
technology

3(3)
public sector
private sector
free rider
market failure
externality

3(4)
poverty threshold
welfare
AFDC
cash transfers
in kind benefits