ECON 002 Lesson 12 Questions

Use the graph above. This is the Supply (seller cost) curve for Gold wedding rings.  Which supply shift happens, a or b,  if "Mining companies find huge new deposits of gold nuggets in Mexico and the United States!":

The law of demand states that an increase in the price of a good,

Economists assume that 'not that much' changes in markets.  They don't spend a lot of their time 'studying shocks' or watching for events that disrupt the millions of different prices and quantities we see every day.   It's a "meh" (small) part of their professional work.