2.) 1The next three questions describe a scenario in which demand or supply curv
ID: 1213246 • Letter: 2
Question
2.) 1The next three questions describe a scenario in which demand or supply curves may be affected. As used here, “scenario” means “event”. The following three questions relate to this scenario: Cell phones are in widespread use. In addition to functioning as a phone, cell phones function as a clock. As a result, American consumers are becoming less interested in purchasing wrist watches—they are using cell phones for time information. The next three questions address the market for WATCHES not cell phones. What happens when the wearing of wrist watches becomes LESS fashionable among consumers? Which curve (for watches) is affected by this scenario? A. The SUPPLY curve for wrist watches B. The DEMAND curve for wrist watches C. NEITHER curve for wrist watches is affected by this
3.)
Cell phones are in widespread use. In addition to functioning as a phone, cell phones function as a clock. As a result, American consumers are becoming less interested in purchasing wrist watches—they are using cell phones for time information. What happens when the wearing of wrist watches becomes LESS fashionable among consumers? What is the effect of this scenario on the EQUILIBRIUM PRICE of wrist watches?
Equilibrium price of watches will DECREASE as a result
Equilibrium price of watches will INCREASE as a result
Equilibrium price of watches will REMAIN THE SAME
Cell phones are in widespread use. In addition to functioning as a phone, cell phones function as a clock. As a result, American consumers are becoming less interested in purchasing wrist watches—they are using cell phones for time information. What happens when the wearing of wrist watches becomes LESS fashionable among consumers? What is the effect of this scenario on the EQUILIBRIUM QUANTITY of wrist watches?
Equilibrium quantity of watches will DECREASE as a result
Equilibrium quantity of watches will INCREASE as a result
Equilibrium quantity of watches will REMAIN THE SAME
16. Consumer Surplus results from
A price BELOW equilibrium resulting in excess quantity supplied
A price ABOVE equilibrium resulting in excess quantity supplied
The demand curve being ABOVE equilibrium price for every item NOT SOLD in a competitive market
The demand curve being ABOVE equilibrium price for every item SOLD in a competitive market
A.Equilibrium price of watches will DECREASE as a result
B.Equilibrium price of watches will INCREASE as a result
C.Equilibrium price of watches will REMAIN THE SAME
Explanation / Answer
As watches go out of fashion, thsi woul d have an effect on taste and prefernces of consumer thereby decreasing the demand.This would cause a leftward shift of the demand curve which would result in lower prices and quantity.
2)What happens when the wearing of wrist watches becomes LESS fashionable among consumers? Which curve (for watches) is affected by this scenario?
B. The DEMAND curve for wrist watches
3)What is the effect of this scenario on the EQUILIBRIUM PRICE of wrist watches?
Equilibrium price of watches will DECREASE as a result
4)What is the effect of this scenario on the EQUILIBRIUM QUANTITY of wrist watches?
Equilibrium quantity of watches will DECREASE as a result
16. Consumer Surplus results from
The demand curve being ABOVE equilibrium price for every item SOLD in a competitive market
A.Equilibrium price of watches will DECREASE as a result
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