SB-chapter 4

Excess demand is the amount by which quantity supplied exceeds quantity demanded. True False

False

A change in which of the following can shift the demand curve for a good? The cost of inputs to production Tastes and preferences of the consumers Taxes paid by and subsidies paid to by the consumer Expectations of the consumers in the future price of the good

Tastes and preferences of the consumers Taxes paid by and subsidies paid to by the consumer Expectations of the consumers in the future price of the good

Which of the following can shift the demand curve for a good? The price of another good rises. The income of the consumers falls. Production techniques improve. The price of the good falls.

The price of another good rises. The income of the consumers falls.

Graphically, quantity supplied refers to a point along the supply curve. the substitution effect. the entire supply curve. the income effect.

a point along the supply curve.

The shift of the supply curve shown in the figure could be due to

a tax levied on the producer of the good.

The shift of the supply curve shown in the figure could be due to _________________________________ the imposition of a tax on the supplier of the good. an increase in the demand for the good. an improvement in technology. an increase in the prices of inputs.

an improvement in technology.

The law of supply states that the quantity supplied of a good is inversely related to the good's price. independent of the good's price. directly related to the good's price.

directly related to the good's price.

The false assumption that what is true for a part will also be true for the whole is called the fallacy of construction. false construction. fallacy of composition. false of composition.

fallacy of composition.

A market supply curve is the vertical sum of some individual supply curves. horizontal sum of all individual supply curves. the maximum supply curve. vertical sum of all individual supply curves.

horizontal sum of all individual supply curves.

When upward pressure on price is exactly offset by the downward pressure on price, a market is said to be indeterminate. competitive. in equilibrium. in surplus.

in equilibrium.

A movement along a demand curve can be caused by a change in the__________________

price of the good.

To calculate market supply add quantities supplied at every price. equilibrium price at every quantity supplied. prices at every quantity supplied. equilibrium quantity at every price.

quantities supplied at every price.

Excess demand is the amount by which: demand exceeds supply. price is less than its equilibrium. price exceeds its equilibrium. quantity demanded exceeds quantity supplied.

quantity demanded exceeds quantity supplied.

Excess supply is the amount by which quantity supplied exceeds quantity demanded. price is less than its equilibrium. price exceeds its equilibrium. supply exceeds demand.

quantity supplied exceeds quantity demanded.

The law of demand states that the quantity demanded rises as price rises. rises as price falls. falls as price rises. falls as price falls.

rises as price falls. falls as price rises.

The law of supply states that quantity supplied rises as price rises. falls as price falls. falls as input prices rise. rises as input prices fall.

rises as price rises. falls as price falls.

Quantity supplied refers to a specific amount that will be supplied per unit of time at a specific price, other things constant. schedule of quantities of a good that will be sold per unit of time at various prices, other things constant.

specific amount that will be supplied per unit of time at a specific price, other things constant.

When supply increases the entire supply curve shifts to the right. there is a movement up along the supply curve.

the entire supply curve shifts to the right.

A typical supply curve is____________

upward sloping

Supply tells us how much will be bought at various income levels. various prices. a specific tax rate. a specific level of income.

various prices.

The fallacy of composition is the false assumption that the composition of consumers is homogeneous. the equilibrium for supply is also the equilibrium for demand. the composition of suppliers is homogeneous. what is true for a part will also be true for the whole.

what is true for a part will also be true for the whole.

True or false: A change in the price of a good causes a shift in the demand curve. True False

False

True or false: Equilibrium is preferable to disequilibrium.

False

Which of the following can shift the demand curve for a good?

The price of another good rises. The income of the consumers falls.

The fallacy of composition warns us that what is true for a part is not necessarily true for the whole.

True

True or false: Equilibrium is the concept in which opposing dynamic forces cancel each other out. True False

True

True or false: Excess supply is the amount by which quantity supplied exceeds quantity demanded. True False

True

The shift of the supply curve shown could be due to

a decrease in the price of inputs.

A movement along a demand curve can be caused by a change in the____________________

price of the good