Chapter 5: Supply
Section 3: Changes in Supply
Factors that will shift the supply curve:
1. Subsidies – Why?
To encourage producers to produce what the nation needs.
To protect young and growing industries from foreign competition.
By lowering the marginal cost at all levels of output, shifting the supply curve to the right. When that happens, it generally lowers the price of the good to the public.
2. Excise Tax
Often used to discourage the sale of harmful product.
Examples: Tax on tobacco and alcohol.
Tax on gas guzzlers for cars, not SUVs.
Causes the supply curve to shift to the left by increasing the price of the good.
Government intervention in a market that affects prices, quantity, or quality of a good.
Emission control on cars.
Airbags for cars.
Specially formulated gasoline for California.
4. Seller Expectations
If the sellers are expecting a rise in the price of the goods, then the seller will hold back the goods until the price has risen.
5. Changes in global economy
Increase in the wages of foreign workers.
New technological inventions.
New discovery of supply from elsewhere.
Chapter 5: Political Parties
Section 2: The Two-Party System
Why a Two-Party System?
American party system began as a two-party system.
Most Americans accept the idea of a two-party system simply because there has always been one.
Nearly all of the elections held in this country—from the presidential contest to those at the local levels—are single-member district elections. A candidate only needs a plurality of the votes to win the election, so most voters think of a vote for a minor party candidate as a “wasted vote.”
Americans are ideologically homogeneous people. There is a broad consensus on fundamental matters.
Therefore, both parties tend to have moderate views on many issues. They both seek to win as many votes as possible to get their candidates into office, so they can’t alienate too many voters.
1. What are the advantages and disadvantages of a multiparty system?
Voters would have a much more meaningful choice among candidates and policy alternatives.
It often leads to instability in government. One party is often unable to win the support of a majority of the voters. As a result, the power to govern must be shared by a number of parties, in a coalition.
2. Why is the one-party system also known as the no party system?
Because it often exists in dictatorships where only one political party is allowed. That party is the party of the ruling clique.
3. Name four factors that tend to influence party choice for individuals.
Family is almost certainly the most important among them. Studies show that nearly two out of every three Americans follow the party allegiance of their parents.
Major events such as the Civil War or the Great Depression can also have a decided influence on the party affiliation of voters.
Economic status also influences party choice. Historically, those in higher income groups are more likely to be Republicans, while those with lower incomes tend to be Democrats.
Other factors such as age, place of residence, level of education, and work environment can affect one’s choice of political party affiliation.