1. DIRECTIONS: ON EACH OF THE SUPPLY GRAPHS PROVIDED, MOVE THE SUPPLY CURVE TO INDICATE THE INFLUENCE OF THESE STATEMENTS ON THE MARKET FOR IPHONES. Section 1: Determinants of Supply

2. Section 1: The Market for smartphones

3.  Scenario: Apple sets up factories in China where they can pay a Chinese worker the equivalent of $1.78 and hour, versus an American worker an average of $25 and hour. S1 Quantity Supplied Price S2 Place Picture Here

4.  Scenario: Computer chips, glass, plastics and other inputs to create smartphones increase in price. S1 Quantity Supplied Price S2 Place Picture Here

5.  Scenario: Apple invests in new capital goods (machines), which increase the speed at which the iPhone can be produced. S1 Quantity Supplied Price S2 Place Picture Here

6.  Scenario: An earthquake destroys the Chinese factories and machines to produce smartphones are left unusable. S1 Quantity Supplied Price S2 Place Picture Here

7.  Scenario: The government eliminates subsidy programs for smartphone firms. S1 Quantity Supplied Price S2 Place Picture Here

8.  Scenario: The government pays Samsung $1 billion a year in order to create incentives to continue to produce their smartphones. S1 Quantity Supplied Price S2 Place Picture Here

9.  Scenario: The government of the U.S. imposes a 30% excise tax on all foreign smartphone suppliers, which account for a large portion of the market. S1 Quantity Supplied Price S2 Place Picture Here

10.  Scenario: The government gives a tax credit ($100,000) to all U.S. smartphone makers or any domestic production of the smartphone. S1 Quantity Supplied Price S2 Place Picture Here

11.  Scenario: The government deregulates the smartphone market by allowing children under 16 (child labor) to work at companies that produce phones. S1 Quantity Supplied Price S2 Place Picture Here

12.  Scenario: The government regulates the smartphone market by making smartphone companies use a certain cleaning product that costs $30 per phone. S1 Quantity Supplied Price S2 Place Picture Here

13.  Scenario: The smartphone market is projected to sell phones for over $1000 on average in the next few years. This motivates new companies to enter the smartphone market. S1 Quantity Supplied Price S2 Place Picture Here

14.  Scenario: With the popularity of tablets, smartphones are beginning to lose their relevance. As a result the price of the average phone is expected to drop over the next few years. Many companies are shifting their resources towards tablet production. S1 Quantity Supplied Price S2 Place Picture Here

15.  Scenario: After the iPhone’s popularity, many companies such as Samsung, Google and Microsoft have entered the market. S1 Quantity Supplied Price S2 Place Picture Here

16.  Scenario: Many companies are not able to compete with Apple for smartphones and exit the market for smartphones. S1 Quantity Supplied Price S2 Place Picture Here

17. DIRECTIONS: ON EACH OF THE DEMAND/SUPPLY GRAPHS PROVIDED, MOVE THE DEMAND OR SUPPLY CURVE TO INDICATE THE INFLUENCE OF THESE STATEMENTS ON THE MARKET. INDICATE THE EFFECT ON PRICE AND QUANTITY. Section 2: Supply and Demand

18.  Gasoline has become the lifeline for modern economies. For each of the following slides indicate the affect of the scenario on the supply and demand for oil products.

19.  Show how an increase in gas prices would affect the popularity of hybrid vehicles.  Move curve and arrow in the direction of the shift. Indicate the effect of price on and quantity. D Quantity of Oil Price Pe D S Qe Place Picture Here Qe

20.  Show how a global recession, which caused people to travel less, will would affect the market for oil (used to create gasoline).  Move curve and arrow in the direction of the shift. Indicate the effect of price on and quantity. D Quantity of Oil Price Pe D S Qe Place Picture Here Qe S

21.  Hydraulic Fracturing (Fracking) leads to the discovery of new oil reserves in the US, which impacts the global market for gasoline.  Move curve and arrow in the direction of the shift. Indicate the effect of price on and quantity. D Quantity of Oil Price Pe D S Qe Place Picture Here Qe S

22.  There is a major oil spill in the Gulf of Mexico, which interrupts the supply of oil to the US.  Move curve and arrow in the direction of the shift. Indicate the effect of price on and quantity. D Quantity of Oil Price Pe D S Qe Place Picture Here Qe S

23.  A new diet has become popular. This diet calls for lots of meat and vegetables, with little or no breads and fruits. Due to this diet, how would each of the following slides be affected?

24.  Show how the new diet would affect the market demand for meat.  Move curve and arrow in the direction of the shift. Indicate the effect of price on and quantity. D Quantity Price Pe D S Qe Place Picture Here S Qe

25.  Show how the new diet would affect the market demand for bread.  Move curve and arrow in the direction of the shift. Indicate the effect of price on and quantity. D Quantity Price Pe D S Qe Place Picture Here S Qe

26.  Show how the new diet would affect the market demand for fruits.  Move curve and arrow in the direction of the shift. Indicate the effect of price on and quantity. D Quantity Price Pe D S Qe Place Picture Here S Qe

27.  Show how the new diet would affect the market demand for vegetables.  Move curve and arrow in the direction of the shift. Indicate the effect of price on and quantity. D Quantity Price Pe D S Qe Place Picture Here S Qe

28. DIRECTIONS: ON EACH OF THE NEXT SLIDES INDICATE HOW THE PRICE CEILINGS OR FLOORS AFFECT SUPPLY AND DEMAND Section 3: Price Ceilings and Floors

29.  The government imposes a price floor at $9. Because the price is above equilibrium it causes a ____________.  Using the formula QS-QD, what is the amount ________ of excess supply? Price Floor

30.  The government imposes a price ceiling at $3. Because the price is above equilibrium it causes a ____________.  Using the formula QS-QD, what is the amount ________ excess demand Price Ceiling