Chapter 4 Proficiency Quiz - Market forces of Supply and Demand

Equilibrium quantity must decrease when

1. demand decreases and supply does not change, 2. when demand does not change and supply decreases, and 3. when both demand and supply decrease.

Equilibrium price must decrease when

1. demand decreases and supply does not change, 2. when demand does not change and supply increases, and 3. when demand decreases and supply increases simultaneously.

Suppose that demand for a good increases and, at the same time, supply of the good decreases. What would happen in the market for the good?

Equilibrium price would increase, but the impact on equilibrium quantity would be ambiguous.

Which of the following is not an example of a market?

In the United States, a sick person cannot legally purchase a kidney

Assume Lianna buys coffee beans in a competitive market. It follows that

Lianna cannot influence the price of coffee beans even if he buys a large quantity of them.

A group of buyers and sellers of a particular good or service is called

a market.

If the demand for a product increases, then we would expect equilibrium price

and equilibrium quantity both to increase.

If a seller in a competitive market chooses to charge more than the going price, then

buyers will make purchases from other sellers.

A competitive market is a market in which

no individual buyer or seller has any significant impact on the market price.

If the supply of a product increases, then we would expect equilibrium price

to decrease and equilibrium quantity to increase.