Question

Fill in the following table stating how the event would affect demand or supply for gold picture frames in Ontario. That is, will the curve shift to the left, to the right, will there be movement along the curve (to the left or to the right) or will there be no impact in the curve.

	Event	Impact on Demand (will the demand curve shift to the left, the right, or remain the same)
1	Picture frames become popular as wedding gifts.
2	The price of picture frames decreases.
3	Fewer people print their photographs.
		Impact on Supply (will the supply curve shift to the left, the right, or remain the same)
4	The cost of the material to make picture frames increases.
5	Demand for picture frames increases.
6	A new technology makes it faster to assemble the frames.

Answer 1

Keep in mind:

Change demand , supply due to price results in movement along curves and due to other factors results in shift of curves.

Impact on Demand :

Events:

1)As picture frames become popular more people will buy them at same price this will shift demand curve right side.

2)As price decreases more people will buy due to fall in price now demand increases due to effect of price thus there will be extension of demand showed by rightward movement along the curve.

3)When fewer people print their photographs obviously the demand for product will reduce this is due to other factor than price so demand curve will shift left side.

Impact on Supply:

Events:

4) As cost of raw material increases the firm i.e.(cost of production rises) will sell less products at same price this effect is not due to change in price so,it will shift supply curve to left.

5)If demand for product rises the firm increases its supply at same price to meet excess demand this effect is also not due to change in price , so supply curve will shift righ side.

6)Due to coming of new technology it will be faster and easier to make Products this will reduce cost of production.Due to low production cost firm will be ready to sell more products at same price.This effect is also not due to change in price thus supply curve will shift to right side .