Chapter 3 Econ Test

An increase in demand while holding supply constant results in a(n) ______ in both equilibrium price and quantity.

increase

Which of the following describe the effects on equilibrium price and equilibrium quantity as a result of a decrease in supply and a simultaneous and proportional increase in demand?

Price rises and the change in equilibrium quantity is indeterminate

A decrease in demand while holding supply constant results in ______ in both equilibrium price and quantity.

a decline

The effects on equilibrium price and quantity due to an increase in supply and a simultaneous decrease in demand are shown by ______.

a decrease in equilibrium price and an indeterminate change in equilibrium quantity

Which of the following show the effects on equilibrium price and quantity due to an increase in supply and a proportional and simultaneous increase in demand ______.

equilibrium quantity falls and an indeterminate change in equilibrium price

If a decline in demand is greater than an increase in supply, the equilibrium quantity will ______.

fall

If an increase in supply is greater than an increase in demand, the equilibrium price will ______.

fall

True or false: A shortage occurs when quantity supplied exceeds quantity demanded.

false

True or false: At equilibrium quantity there is either a shortage or surplus

false

A price (one word) is a minimum price fixed by the government, generally imposed above the equilibrium price.

floor

____benefit is the additional utility gained from consuming one more unit of a good or service.

marginal

The ongoing supply of a good or service by a producer essentially reflects the ______ of producing the good or service.

marginal cost

A surplus is also known as excess ______.

supply

The ability of the competitive forces of supply and demand to establish a price at which selling and buying decisions are consistent is called ______.

the rationing function of prices

Equilibrium price and equilibrium quantity occur where ______.

the supply curve intersects the demand curve

Which of the following in the rental market for housing benefits renters, but makes it unprofitable for suppliers or landowners?

A price ceiling

An increase in equilibrium quantity and indeterminate change in equilibrium price is a result of which of the following?

A simultaneous and proportional increase in supply and demand

Which of the following refers to a particular apportionment or mix of goods and services most highly valued by society?

Allocative efficiency

Which of the following reflects an increase in demand, while holding supply constant?

An increase in both equilibrium price and quantity

In which of the following situations do governments intervene to prevent prices from rising above or falling below their equilibrium levels?

Prices are too high for consumers. Prices are too low for firms.

Which of the following describes the effects on equilibrium price and equilibrium quantity as a result of a simultaneous increase in supply and demand?

The change in price is indeterminate and quantity rises.

What determines market price and equilibrium output in a market?

The interaction of buyers and sellers

A price (floor/ceiling) is the maximum legal price a seller may charge for a product or service

ceiling

The (one word) output is the quantity at which quantity demanded equals quantity supplied in a competitive market.

equilibrium

As a result of a simultaneous increase in supply and decrease in demand, _____.

price falls and the change in equilibrium quantity is indeterminate

The production of a good or service in the least costly way is known as ______ efficiency.

productive

Competition among corn producers forces them to use the best technology and right mix of productive resources; otherwise their costs will be too high relative to the market price and they will be unprofitable. This is best described as ______.

productive efficiency

An increase in (one word), while holding demand constant, results in a decrease in equilibrium price, but an increase in equilibrium quantity.

supply

If the decrease in the supply of a good is greater than the decrease in the demand for the good, the equilibrium price will ______.

rise

If the increase in demand is greater than the decrease in supply, the equilibrium quantity will ______.

rise

At the equilibrium price, quantity equals quantity .

supplied, demanded

The ______ of a good or service by a producer essentially reflects the marginal cost of producing the good or service.

supply

An increase in the equilibrium price of a good and an indeterminate change in the equilibrium quantity is the result of ______.

an increase in demand and decrease in supply

The effects on equilibrium price and quantity due to an increase in supply and simultaneous increase in demand are shown by ______.

an increase in the equilibrium quantity and an indeterminate change in price