Micro 3

2. Lecture 3
Microeconomics

3. Opening
Prayer

4. Quiz
1. What are the two questions
economists always ask?
2. What is always the correct answer in
economics?
3. What is opportunity cost?
4. What is Comparative Advantage?

5. Quizmaster
10 questions
4 answers
email to
mckytee@go.byuh.edu
1 Extra Credit Point

8. Learning English
Access to the world’s
knowledge

9. Scriptures Economics
Spirit

10. Demand
Supply
Equilibrium

11. Demand

13. Price Quantity
$2
$5
$7
$10
$12
$15
$18
$20
$25

14. $0
$5
$10
$15
$20
$25
0 5 10 15 20 25
Quantity
Price

15. Value - Willing to Pay
Price
Consumer Surplus
$20
$15
$5

16. Consumer Surplus
Area above the price line
and below the demand
curve

17. $0
$5
$10
$15
$20
$25
0 5 10 15 20 25
Quantity
Price
Consumer
Surplus
($15 x 15 ) ÷ 2
= $112.50
$10 x 15
= $150

18. $0
$5
$10
$15
$20
$25
0 5 10 15 20 25
Quantity
Price
Consumer
Surplus
($20 x 20 ) ÷ 2
= $200
$5 x 20
= $100

19. $0
$5
$10
$15
$20
$25
0 5 10 15 20 25
Quantity
Price
($5 x 5 ) ÷ 2
= $12.50
$20 x 5
= $100

20. Change in Price
Change in Quantity
Demanded

21. Shift in Demand
Income
Population
Price of Substitutes
Price of Complements
Expectations
Tastes

22. Quantity
Price
Shift in Demand

23. Supply

24. Producer Surplus
Area below the price line
and above the supply
curve

25. $0
$5
$10
$15
$20
$25
0 5 10 15 20 25
Quantity
Price
Producer
Surplus
($9 x 15 ) ÷ 2
= $63

26. $0
$5
$10
$15
$20
$25
0 5 10 15 20 25
Quantity
Price
Producer
Surplus
($14 x 23 ) ÷ 2
= $161

27. Shift in Supply
Innovation
Taxes and Subsidies
Expectations
Entry or Exit of Producers
Changes in Costs

28. Quantity
Price
Shift in Supply