1. Predict the direction of change (increase or decrease) foreither supply or demand (which curve?) in the followingsituations:

a. Several new companies enter the cell phone industry.

b. Consumers suddenly decide SUVs are unfashionable.

c. The U.S. Surgeon General issues a report stating thattomatoes prevent colds.

d. Frost threatens to damage the coffee crop, and consumersexpect the price to rise sharply in the future.

e. The price of tea falls. What is the effect on the coffeemarket?

f. The price of sugar rises. What is the effect on the coffeemarket?

g. Tobacco lobbyists convince Gongress to remove the tax paid bysellers on each carton of cigarettes sold.

h. A new type of robot is invented that will pick peaches.

2. What is the predicted effect on equilibrium price andequilibrium quantity of an increase in demand?

3. What is the predicted effect on equilibrum price andequlibrium quantity of an increase in supply?