<p> Economics Study Guide Unit 2 Ms. Walker</p><p> The law of demand states that:______</p><p> The law of supply states that:______ Demand Shifters (6):______</p><p> Supply Shifters(6):______</p><p> Equilibrium Price:______</p><p> Equilibrium price is also called:______</p><p> Equilibrium Quantity:______</p><p> Elasticity:______</p><p> Marginal Utility:______</p><p> A shortage results when prices are too______and quantity supplied is greater/lesser than quanitity demanded.</p><p> A surplus results when prices are too______and quantity supplied is greater/lesser than quantity demanded.</p><p> Ways in which government can exert control/influence supply & demand: a.1. price floors______</p><p> a.2. price ceilings______</p><p> a.3. excise taxes______ Why would a government decide to ration? ______</p><p>Use the graph below to answer the following question.</p><p> The price at which supply and demand are in balance is known as:______</p><p> The equilibrium price of Mac Pro laptops is $1300. Because of stiff competition in the tablet market, Apple decides to drop all their prices by 10% but does not change their production plans. The effect on the market for Mac pro laptops is: </p><p> a. Excess demand for the competitor’s tablets b. Excess supply of Mac Pros c. Equilibrium quantity d. Shortage of Mac Pros</p><p>Indicate the letter of the graph which best illustrates changes to the equilibrium price and quantity for each situation given. You may use a graph more than once. </p><p>Graph A Graph B Graph C Graph D</p><p> Which graph shows a decrease in equilibrium price but an increase in equilibrium quantity? a. Graph A b. Graph B c. Graph C d. Graph D   Which graph shows an increase in equilibrium price but a decrease in equilibrium quantity? a. Graph b. Graph c. Graph C d. Graph A B D e.  Which graph shows a decrease in equilibrium price and a decrease in equilibrium quantity? a. Graph A b. Graph B c. Graph C d. Graph D e. f. g. h. i. j. k. l. m. n. Market Structures o.</p><p> p. q. r. s. t. u. v. w. x.  What factors determine the market structure of a specific market______a. ______b.  In a market with perfect competition, how are prices determined? ______c.  How are prices determined in an oligopoly? ______d.  Collusion:______e.  Cartel:______f.  What examples can you think of that fall under the category of oligopoly, where a few companies dominate the market, would be an example of which type of market structure? o ______o  As it becomes easier to start a new business in a market, what effect is there on competition? o ______o  In which market structure do producers have the most power? o ______o  What is meant by the term “Public Goods”:______o  Positive Externality:______o  Negative Externality:______o  Why doesn’t the market system work to provide street lighting and other public goods? o ______o  What is meant by “excludable and non-excludable with regard to public goods?: o ______o  Define the “free rider problem”: o ______o  What is an example of a positive externality in a scenario where there is an outdoor concert? o ______o o</p>