Chapter 6 *Prices* (pp. 124) Section 1 *Combining Supply and

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Chapter 6 “Prices” (pp. 124)
Section 1 “Combining Supply and Demand”
PREVIEW OBJECTIVES (pp. 125)
1. Explain: how supply and demand
2. Compare: a market in
3. Identify: how the government sometimes
4. Analyze: the effects of price ceilings and price
floors.
SECTION FOCUS In an uncontrolled market, the price
of a good and quantity sold will settle at a point
where the quantity supplied equals the quantity
demanded. The government can set a maximum or
minimum price, but that can lead to an imbalance
between supply and demand.
KEY TERMS:
• Equilibrium:
• Disequilibrium:
• Excess demand:
• Excess supply:
• Price ceiling:
• Rent control:
• Minimum wage:
Copy
Figure 6.1 Finding Equilibrium (pp. 126).
Figure 6.2 Excess Demand and Excess Supply (pp. 127).
Figure 6.3 The Effects of Rent Control (pp. 129).
Figure 6.4 Effects of Minimum Wage (pp. 131).
Chapter 6 “Prices”
Section 2 “Changes in Market Equilibrium”
PREVIEW OBJECTIVES (pp. 133)
1. Identify:
2. Explain:
3. Explain:
SECTION FOCUS When a supply or demand curve shifts, a new
equilibrium occurs. The market price and quantity sold move
toward the new equilibrium.
KEY TERMS:
• Surplus:
• Shortage:
• Search costs:
COPY: Figure 6.5, Falling Prices and the Supply Curve
COPY: Figure 6.6 A Change in Supply and
Figure 6.7 A Change in Demand
Chapter 6 “Prices”
Section 3 “The Role of Prices”
PREVIEW OBJECTIVES (pp. 139)
1. Analyze:
2. List:
3. Explain:
4. Describe:
SECTION FOCUS Goods and services can be divided up among
buyers by a central plan or a price-based market system.
Prices allow an efficient, flexible exchange of goods.
KEY TERMS:
•
•
•
•
Supply shock:
Rationing:
Black market:
Spillover costs:

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