Ap Macroeconomics Summer Assignment Economics Worksheets (Page 3 of 3) in pdf

Ap Macroeconomics Summer Assignment Economics Worksheets Page 3

Summer Assignment

General Practice

Complete the following problems. Be sure to properly label all graphs and show calculations

(esp. for opportunity cost).

( __ / 15)

1. Maria can read 50 pages of economics in an hour. She can also read 50 pages of

sociology in an hour. She spends 5 hours per day studying.

a. Draw Maria’s production possibilities frontier for reading economics and

sociology. Assume a constant opportunity cost.

b. What is Maria’s opportunity cost of reading 100 pages of sociology? Explain and

show your calculations.

( __ / 25)

2. Assume the market for pizza has the following supply and demand schedules.

Price ($)

Quantity Demanded

Quantity Supplied

135 pizzas

26 pizzas

104

110

121

a. Draw a properly-labeled supply and demand diagram showing this market. Be

sure to fully label your axes with the given numbers.

b. What is equilibrium price? What is equilibrium quantity?

c. Suppose the price of pizza rises to $9. Does this produce a shortage, surplus, or

equilibrium? What is the size (# of units) of the shortage/surplus?

d. Suppose the price of pizza falls to $4. Does this produce a shortage, surplus, or

equilibrium? What is the size (# of units) of the shortage/surplus?

e. What will likely happen to equilibrium price and quantity if scientists discover

that pizza is actually good for people’s health? Draw a new diagram showing the

shift in demand and/or supply that would result. Explain which shifters of supply

and/or demand are at work in this scenario. Be sure to also indicate how

equilibrium price and quantity have changed.

Hint: what represents constant opportunity cost? Straight-line PPF, or bowed-out PPF?

Mr. Oppermann’s AP Macroeconomics – p.3

Ap Macroeconomics Summer Assignment Economics Worksheets Page 3