In the following scenarios, you will be given a product and an event. Determine If there will be an increase OR decrease in either the supply OR demand, what happens to the price of the product, and what happens to the quantity bought and sold. The first two are answered for you as examples. EXAMPLE! 1 New oil fields are discovered by new companies in Canada EX 1 ANSWER Supply increases, price decreases, quantities increase EXAMPLE! 2 Penguin merchandise. The Penguins play well and contend for a playoff spot. EX 2 ANSWER Demand increases, price increases, quantities decrease 1. Beef. The price of chicken suddenly drops. 2. Newly constructed houses. The price of lumber doubles. 3. The government places a 30% excise tax on alcohol. 4. Peanut butter cookies. The price of chocolate chip cookies increases. 5. Pepsi. A new machine is created that allows for faster production

12th Edition

ISBN:9781259929434

Author:William Nickels

Publisher:William Nickels

Chapter1: Taking Risks And Making Profits Within The Dynamic Business Environment

Section: Chapter Questions

Problem 1CE

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Question

In the following scenarios, you will be given a product and an event. Determine If there will be an increase OR decrease in either the supply OR demand, what happens to the price of the product, and what happens to the quantity bought and sold. The first two are answered for you as examples. EXAMPLE! 1 New oil fields are discovered by new companies in Canada

EX 1 ANSWER Supply increases, price decreases, quantities increase

EXAMPLE! 2 Penguin merchandise. The Penguins play well and contend for a playoff spot.

EX 2 ANSWER Demand increases, price increases, quantities decrease

1. Beef. The price of chicken suddenly drops.

2. Newly constructed houses. The price of lumber doubles.

3. The government places a 30% excise tax on alcohol.

4. Peanut butter cookies. The price of chocolate chip cookies increases.

5. Pepsi. A new machine is created that allows for faster production

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