Reminder on shifts of curves versus movements along curves
As. you answer the questions above. make sure to keep in mind the difference between moving along a curve and a shift of the curve.’ Look back at the gasoline-price curve in Figure 3-1 on page 47. When the price of 011 rose and the production of 011 declined because of political disturbances In the 1970s. these changes resulted from an inward shift In the supply curve. When sales of gasoline declined in response to the higher price. that was a movement along the demand curve. .
Does the history of computer prices and quantities shown in Figure 3-3 on page SO look more like shifting supply or shifting demand (Question 8 at the end of this chapter explores this Issue further.)
How would you describe arise in chicken production that was Induced by a rise In chicken prices? What about the case of a rise in chicken production because of a fall in the price of chicken feed?
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