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Page 1: 2015 day 7

On slates1. If you could attend any college in the US

where would it be?2. Why did you pick that college?

3. Do you think college is too expensive?4. What 2 things would happen if the state

of AZ lowered the price of college classes to $50 per class?

Page 2: 2015 day 7

In your notesFind the equilibrium price of 1 roll of toilet

paper

Price Quantity Supplied

Quantity DemandedPrice

$0.50$ 1.00$ 1.75$ 2.25$ 3.00

1003007009001500

$ 0.25$ 0.50$ 1.00$ 2.25$ 3.00

1500900600400300

0

0.25

0.5

0.75

1

1.25

1.5

1.75

2

2.25

2.5

2.75

3

0 100 200 300 400 500 600 700 800 900 1000 1100 1200 1300 1400 1500

2. Why might a politician argue this isn’t a fair

price for large families?

Page 3: 2015 day 7

Toilet paper

0

0.25

0.5

0.75

1

1.25

1.5

1.75

2

2.25

2.5

2.75

3

0 100 200 300 400 500 600 700 800 900 1000 1100 1200 1300 1400 1500

D

S

P

Q

Page 4: 2015 day 7

At your tablesSay the government, to help large families, made it illegal for the price to be higher than $0.50 per roll.1. What would happen to the amount of toilet paper people

would want to buy?2. What would happen to the amount of toilet paper producers

would want to sell?3. What would happen to the number of sheets per roll?4. What would happen to the texture of the toilet paper?5. What other markets might be effected? (paper products?)6. Who would get first chance at buying the toilet paper?7. What would happen to the level of corruption in the country?

Page 5: 2015 day 7

Toilet paper

0

0.25

0.5

0.75

1

1.25

1.5

1.75

2

2.25

2.5

2.75

3

0 100 200 300 400 500 600 700 800 900 1000 1100 1200 1300 1400 1500

D

SP

Q

Page 6: 2015 day 7

Surely no country would try this….

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Page 9: 2015 day 7

Price CeilingDesigned to help

consumersIllegal to charge higher than the

priceExample:

Venezuela TPProblems?

Quality Shortages

Page 10: 2015 day 7

Price CeilingDesigned to help

consumersIllegal to charge

higher than the priceExample: Rent

ControlsProblems?

QualityShow rent control

clip

Page 11: 2015 day 7

Hand out worksheet

Page 12: 2015 day 7

On slates

1. List 4 jobs you could do without any special skills

2. List 4 jobs you could do that require skills, licenses or education

Page 13: 2015 day 7

Types of labor• Skilled labor: require skills, licenses or

education• Salary?• Give 3 examples

• Unskilled labor: lower human capital, physical, entry level

• Salary?• Type of person?• Give 3 examples

Who are you right now? In 10 years?

Students, low skilled immigrants, uneducated

Professionals, skilled immigrants, educated

Page 14: 2015 day 7
Page 15: 2015 day 7

Germany lacks a min wage

Around the World

Page 16: 2015 day 7

Conclusion?

Page 17: 2015 day 7

Minimum Wage Graph• Price floor on unskilled labor market• Subway test, • $5/hour• $7/hour, • $10/hour,• $15/hour, • $25/hour,

Page 18: 2015 day 7

Minimum Wage assignment• Read both articles• Identify 2 main ideas from each side• Write a 2 paragraph letter to your

congressman asking them to vote FOR or AGAINST the $15/minimum wage

Walter WilliamsElizabeth Warren

Congressman Grijalva

Outline: PG 1 – intro/background

debate sides, main ideas

PG 2 – How do you think they should vote? Support with economic ideas

Congresswoman….

Page 19: 2015 day 7

Exam Review

1. Why do you think companies would rather sell products with

an inelastic demand? (hint look at the Y-axis of your graph)

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Page 21: 2015 day 7

What is the price when this market is at equilibrium?

A. Around 33B. Around $ 3.25C. Around $ 2.25D. Around p *

P

Page 22: 2015 day 7

Economists would describe this demand curve as:

A. elasticB. inelasticC. quantityD. inferior

Page 23: 2015 day 7

How many more goods will this company sell if they lower the price from $1 to $0.75?

A. 3B. 6C. 9D. 12

Page 24: 2015 day 7

Which of the following goods would most likely have this sort of demand?

A. Toilet paperB. Hot cheetosC. Water on a 110+

degree dayD. Lifesaving drugs

Page 25: 2015 day 7

Economists would describe this demand curve as:

A. elasticB. inelasticC. quantityD. inferior

Page 26: 2015 day 7

Which good matches this demand curve?

A. Rims for a truckB. hamburgersC. Plastic surgeryD. Water on a 110+

degree day

Page 27: 2015 day 7

How many FEWER goods would this company sell if they raised their price from

$0.50 to $1?

A. 4B. 3C. 2D. 1

Page 28: 2015 day 7

Tickets to the movies have a more elastic demand curve, so if a company wanted to increase their revenue, they should:A. Raise their priceB. Lower their priceC. Keep their price the sameD. Consider the substitutes

Page 29: 2015 day 7

Lifesaving, pharmaceutical drugs have an inelastic demand curve, so if a company wanted to increase their revenue, they

should:

A. Raise their priceB. Lower their priceC. Keep their price the

sameD. Consider the

substitutes

Page 30: 2015 day 7

What probably caused this change?

A. Bus ridership increases

B. New car sales decline

C. Unemployment decreases

D. Consumers buy more SUV’s

GasolinePrice

Quantity

Page 31: 2015 day 7

What probably caused this change?

A. Price of pizza increased

B. Population of Tucson decreased

C. Price of soda increased

D. Average income in Tucson decreased

Tacos

Page 32: 2015 day 7

What probably caused this change?A. Price of new

clothing decreased

B. Population of Tucson decreased

C. Price of used clothing increased

D. Average income in Tucson decreased

Used Clothing

Page 33: 2015 day 7

What probably caused this change?

A. Bus ridership increases

B. Tablet computer sales increase

C. Unemployment decreases

D. Pencil prices decrease

Notebook paperPrice

Quantity

Page 34: 2015 day 7

What probably caused this change?A. Average income in

Tucson decreasedB. Population of

Tucson decreasedC. Price of Pepsi

decreasedD. Price of Coke

increased

Pepsi

Page 35: 2015 day 7

What probably caused this change?A. Average

income in US decreased

B. Number of new brokerage accounts triples in US

C. Sales of iphone decline

D. Sales of Blackberry’s increase

Shares of Apple stock

Page 36: 2015 day 7

What is the price when this market is at equilibrium?

A. Around 40B. Around $ 6 C. Around $ 3D. Around $ 30

P

Q

S

D

Widgets

Page 37: 2015 day 7

How many widgets will be supplied in this market when the price is $8?

A. Around 40B. Around 50C. Around 30D. Around $ 30

P

Q

S

D

Widgets

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What might explain this change?A. Average US

income increased

B. Average US income decreased

C. Population of US decreases

D. New car company begins operation

Q

S

D

WidgetsNew cars

Page 39: 2015 day 7

Based on the change in this graph, which outcome is true?

A. Price of cars will increase

B. Price of cars will decrease

C. There will be no change

D. Quantity of cars will decrease Q

S

D

WidgetsNew cars

Page 40: 2015 day 7

Based on the change in this graph, which outcome is true?

A. Two car companies merge

B. A new Korean car company begins selling cars in the US

C. Price of oil increases

D. Price of steel increases

Q

S

D

WidgetsNew cars

New carsS

D

Page 41: 2015 day 7

Based on the change in this graph, which outcome is true?

A. Price of cars will increase

B. Price of cars will decrease

C. There will be no change

D. Quantity of cars will decrease

Q

S

D

WidgetsNew cars

New carsS

D

Page 42: 2015 day 7

Based on the change in this graph, which outcome is true?

A. Car companies think price of cars will decline next year

B. Demand for new cars increased

C. Wages of autoworkers decreased

D. Wages of autoworkers increased

Q

S

D

WidgetsNew cars

New carsS

D

New cars

Page 43: 2015 day 7

Which graph shows the effect of an increase in immigration on the used car market?

A. Graph AB. Graph BC. Graph CD. Graph D

Graph A

Graph B

Graph D

Graph C

Page 44: 2015 day 7

Which graph shows the effect of more expensive gasoline on SUV’s?

A. Graph AB. Graph BC. Graph CD. Graph D

Graph A

Graph B

Graph D

Graph C

Page 45: 2015 day 7

Which graph shows the effect of a decrease in the price of jet fuel on the airline ticket market?

A. Graph AB. Graph BC. Graph CD. Graph D

Graph A

Graph B

Graph D

Graph C

Page 46: 2015 day 7

Which graph shows a decrease in equilibrium price and an increase in quantity?

A. Graph AB. Graph BC. Graph CD. Graph D

Graph A

Graph B

Graph D

Graph C

Page 47: 2015 day 7

Which will probably happen after the US Airways/American Airlines merger?A. Lower pricesB. Higher pricesC. No changeD. They will become

an inferior good

Page 48: 2015 day 7

Which will probably happen if the price of jet fuel declines to the price of airline tickets??A. Lower pricesB. Higher pricesC. No changeD. They will

become an inferior good

Page 49: 2015 day 7

Which graph shows the effect of a decrease in income taxes on the airline ticket market?

A. Graph AB. Graph BC. Graph CD. Graph D

Graph A

Graph B

Graph D

Graph C

Page 50: 2015 day 7

Smartphone market: Blackberry files for bankruptcy

A. Prices increase

B. Prices decrease

C. No changeD. Quantity will

increase

Page 51: 2015 day 7

Smartphone market: plastic prices double

A. Prices increaseB. Prices decreaseC. No changeD. Quantity will

increase

Page 52: 2015 day 7

Smartphone market: Data plan prices increase

A. Prices increaseB. Prices decreaseC. No changeD. Quantity will

increase

Page 53: 2015 day 7

Smartphone market: Producers expect the price of smart phones to drop next year

A. Prices increaseB. Prices decreaseC. No changeD. Quantity will

decrease

Page 54: 2015 day 7

Smartphone market: New iphone commercials featuring Pittbull

A. Prices increaseB. Prices decreaseC. No changeD. Quantity will

decrease

Page 55: 2015 day 7

Flatscreen tv market: trade agreements allow producers to use cheaper labor in South Korea

A. Prices increaseB. Prices decreaseC. No changeD. Quantity will

decrease

Page 56: 2015 day 7

Flatscreen tv market: Producers expect the price of TVs to decline next year.

A. Prices increaseB. Prices decreaseC. No changeD. Quantity will

decrease

Page 57: 2015 day 7

Apartment market: Consumers start buying houses again due to bull market

A. Prices increaseB. Prices decreaseC. No changeD. Quantity will

increase

Page 58: 2015 day 7

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