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Fill-in-the-blank: According to the law of demand, an increase in price ________________ the quantity of demand. Fill-in-the-blank: A change in price causes movement along a demand curve and a change in _________________. Fill-in-the-blank: A change in demand causes a __________________ the demand curve. A change in quantity demanded causes a __________________ the demand curve. (note: blank may be more than one word) Fill-in-the-blank: An increase in demand for a product __________________ the equilibrium price and ___________________ the equilibrium quantity. Fill-in-the-blank: An increase in the price of wood shifts the supply curve for pencils _______________; an improvement in pencil-production technology shifts the supply curve for pencils ___________________; a tax on pencil production shifts the supply curve for pencils _____________________.:::::::::::::::: 1. Indicate whether each of the following questions is normative or positive:Should your city build levees strong enough to protect the city from Category Five hurricanes?How did Hurricane Katrina affect housing prices in New Orleans and Baton Rouge?Who should pay for a new skate park?Should a school district increase teachers’ salaries by 20%?Would an increase in teachers’ salaries improve the average quality of teachers?Fill-in-the-blank: An increase in the wage for high-school graduates ___________________ the opportunity cost of college __________________________________________ 3. Consider a nation that produces baseball mitts and soccer balls. The following table shows the possible combinations of the 2 products.Baseball mitts (millions)02468Soccer balls (millions)302418100 Suppose the technology for producing mitts improves. In contrast, the technology for producing soccer balls does not change. What happens to the production possibilities curve? (Explain)Fill-in-the-blank: The opportunity cost for the first 2 million mitts is _______________ million soccer balls and the opportunity costs of the last 2 million mitts is _______________ soccer balls.

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