A. The market for gizmos is perfectly competitive and firms are earning short-run positive profits.
- Draw correctly labeled side-by-side graphs of the market for gizmos and the profit-maximizing output of a typical gizmo producer.
- Identify the market output as Qm and the market price as Pm.
- Identify the firm’s output as Qf and the firm’s price as Pf.
- Identify the area that corresponds to positive profit.
B. Assume the market for gizmos is a constant cost industry. In the long run, how will the following change?
- The number of gizmo producers in the market.
- The price of gizmos.
- Construct and Interpret graphs for perfectly competitive industries and firms demonstrating the long run and short run impact based upon changes in supply and demand
- Differentiate between cost-constant, increasing cost, decreasing cost industry.
III Turn in Your Homework
- PPT 3.6 Long Run Cost-constant, Increasing cost, and Decreasing cost industry.
- Allocative efficiency = ( Price(marginal benefit)=MC)
- Productive Efficiency = (Price (MR) = Minimum point of ATC) cost minimized
- Page 612 Check Your Understanding 1-2
- Page 612-613 Tackle the Test 1-6
Perfect Competition on AP Classroom
- Complete record keeping for a dishonored check.
- Journalize an electronic funds transfer.
- Journalize a debit card transaction
- Using the textbook and discussion, compare debit cards and credit cards, noting similarities and differences in a bubble Map.
Debit Cards vs Credit Cards
See iLearn PPT 5-3
IV Classwork – on Mindtap
- Work Together & On Your Own (p. 139).
- Aplia: Application Problem 5-3
If the quantity supply and quantity demand for squash is at equilibrium, then a drought occurs damaging the squash crop:
Question & Answer
- What will happen to supply?
- What will happen to the price of squash?
- What will happen to the quantity of squash?
- Analyze how prices change through the interaction of buyers and sellers in a market including the role of supply, demand, equilibrium, surpluses, and shortages.
- Integrate and evaluate information presented in order to determine the impact on equilibrium price and quantity
A. Shifting Demand and Supply
Shifting Demand and Supply- Macro Topic 1.6 (Micro Topic 2.7)
Double Shifts- Supply and Demand
From a starting point of D & S
- What is the current equilibrium price? Where S & D intersect.
- What is the new price if demand remains constant and supply increases to S2?
- What would be the new price if demand decreases to D1 and Supply increases to S2?
- What would be the price if demand remains constant D and Supply increases to S1?
- What could cause an increase in the supply of gold?