Hints: Questions 3-5 are about demand. For each question, you must both explain your answer verbally and illustrate your answer graphically. Label the axes of your graph and label or otherwise identify the curve(s) in your graph. If you use abbreviations, state what the abbreviations mean. Each question is independent of the others and assumes “other things being equal.”
For each question, your explanation should state:
(1) the demand curve to which the result pertains (it is: “the demand curve for McDonald’s hamburgers”).
(2) whether the result involves “moving along” the demand curve or “shifting” the demand curve.
(3) the direction of the “moving along” or “shift.”
(4) why the “moving along” or “shift” occurs.
B. What happens to the demand for McDonald’s hamburgers when ______?
3. McDonald’s decreases the price of its hamburgers.
4. Wendy’s decreases the price of its hamburgers.
5. Scientific studies show that hamburgers cause cancer.