Microeconomics Chapter 3

After widespread press reports about the dangers of contracting "mad cow disease" by consuming beef from Canada, the likely economic effect on the U.S. demand curve for beef from Canada is:

a shift of the demand curve for beef to the left.

Which of the following would reduce the supply of microcomputers?

higher wage rates for the workers that assemble the computers

The demand schedule for a good:

indicates the quantities that will be purchased at various market prices.

If a firm faces , while the prices for the output the firm produces remain unchanged, a firm's profits will increase.

lower costs of production

When economists talk about supply, they are referring to a relationship between price received for each unit sold and the .

quantity supplied

A drought decreases the supply of agricultural products, which means that at any given price a lower quantity will be supplied; conversely, especially good weather would shift the ________.

supply curve to the right

Andy views soda and pizza as complements to one another. If the price of pizza decreases, economists would expect:

Andy's demand for soda to increase.

_______ are enacted when discontented sellers, feeling that prices are too low, appeal to legislators to keep prices from falling.

Price floors

If new manufacturers enter the computer industry, then (ceteris paribus):

The supply curve shifts to the right.

According to the law of supply:

There is a direct relationship between price and the quantity supplied.

The term "ceteris paribus" means that:

all variables except those specified are constant.

The nature of demand indicates that as the price of a good increases:

buyers to purchase less of it.

The is the quantity where quantity demanded and quantity supplied are equal at a certain price

equilibrium quantity

If the price is below the equilibrium level, then the quantity demanded will exceed the quantity supplied. This is known as:

excess demand

The demand curve for a typical good has a(n):

negative slope because some consumers switch to other goods as the price rises.

The downward slope of the demand curve again illustrates the pattern that as ______ rises, _______ decreases.

price, quantity demanded

A supply curve is a graphical illustration of the relationship between price, shown on the vertical axis, and _____, shown on the horizontal axis.

quantity

A demand curve shows the relationship between price and on a graph.

quantity demanded

refers to the total number of units that are purchased at that price.

quantity demanded

A severe freeze has once again damaged the Florida orange crop. The impact on the market for orange juice will be a leftward shift of:

the supply curve.

When quantity demanded decreases in response to a change in price:

there is a movement up along the demand curve