Econ 2301 CH 3

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A decrease in the price of electricity can best be explained by

A decrease in the population

Ceteris Paribus, which of the following is most likely to cause an increase in the quantity demanded of perfume?

A decrease in the price of perfume

A lower quantity demanded os a good reflects, ceteris paribus

A higher price of the good

Peanut butter and jelly are compliments. A decrease in the price of one will result in

An increase in the demand for the other

Ceteris paribus, which of the following is most likely to cause an increase in the quantity supplied of perfume

An increase in the price of perfume

In table 3.1, if the price is $4 (demand 30, supplied 30) the market will

Be in equilibrium

Which of the following is purchased in a product market

Cell phone service

A leftward shift of the market demand curve for HDTVs, ceteris paribus, causes equilibrium price to

Decrease and the quantity to decrease

In table 3.1, if the price is $2 (demand 32, supplied 10) the market will

Experience a shortage of 22 units

In table 3.1, if the price is $8 (demand 14, supplied 70) the market will

Experience a surplus of 56 units

A change in demand means there has been a shift in the demand curve, and a change in quantity demanded

Means that price has changed and there is movement along the demand curve

Which determinate of demand changes in the personal computer market as more individuals become interested in "surfing the internet"

Number of buyers

A rightward shift of the market demand curve for MP3 players, ceteris paribus, causes equilibrium

Price to increase and quantity to increase

In a market economy, which of the following determines the answer to the WHAT to produce question

Prices and profit

When a surplus exists for a product

Producers reduce the level of output and reduce price

A market in which final goods and services are exchanged is a

Product market

The goal of the business firms in a market economy is to maximize

Profits

Suppose a hurricane hits Florida causing widespread damage to houses and businesses. The governor of Florida places a price ceiling on all building materials to keep prices reasonable. Which of the following is the most likely result?

Shortages of building materials and a slower recovery from the storm

If there is a shortage at a given price, then

That price is less than the equilibrium price

In 2007 a company sold 35,000 MP3 players at $150 each. In 2008 the same company sold 40,000 MP3 players at $170 each. This information suggests that

The demand for MP3 players increased from 2007 to 2008

Which of the following can change without shifting either demand or supply, ceteris paribus

The price of the good itself


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