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AP Microeconomics Mkt 4 B a Define a Surplus and Shortage B Explain Using Graphs Where Appropriate How Changes in Underlying Conditions and Shocks to a Questions

Practise diagnosing shortages and surpluses, tracing single or simultaneous market shifts, resolving indeterminate outcomes, and comparing surplus changes.

Syllabus
Effective Fall 2022
Course
AP Microeconomics

Exam points

  • compare quantity demanded and supplied to identify a shortage or surplus and the price adjustment
  • trace a demand or supply shock to the new equilibrium price, quantity and direction of surplus change
  • combine simultaneous demand and supply shifts and identify which price or quantity outcome is indeterminate
  • infer the demand-and-supply shift combination from observed equilibrium price and quantity changes
  • shade or compare changes in consumer, producer and total surplus as a market moves between outcomes

AP Microeconomics Mkt 4 B a Define a Surplus and Shortage B Explain Using Graphs Where Appropriate How Changes in Underlying Conditions and Shocks to a Questions question 1

[Maximum number: 1]

Sugar is produced in a perfectly competitive market using inputs from perfectly competitive factor markets. Frank Sugar Co. is a representative firm in the sugar market.

Assume the demand for sugar increases and sugar is produced in a constant-cost industry.

On your graph in part (a), show the short-run effect of the increased demand for sugar on the market price, labeled P2\mathrm{P}_{2}, and the quantity sold by Frank Sugar Co., labeled QN\mathrm{Q}_{\mathrm{N}}.

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