ECON 2301 - Unit 2

Which of the following shifts the supply curve of popcorn leftward?

a decrease in the number of popcorn suppliers

A decrease in supply will lead to

an increase in equilibrium Price and a decrease in equilibrium Quantity

Starting at equilibrium, what happens to equilibrium price and quantity if demand decreases

equilibrium price will fall and equilibrium quantity will fall

Starting at equilibrium, an increase in demand will have what effect on equilibrium price and quantity

equilibrium price will rise and equilibrium quantity will increase

Which of the following is NOT a reason for the downward slop of the demand curve

expected profit effect

The market supply curve is the

horizontal sum of the individual supply curves

The law of supply states that, other things remaining constant

if the price of a good increases, the quantity supplied increases

If vacations are a normal good then an increase in income will

increase demand of vacations

The price of a major input in the production of metal decreases in price. This price decrease will

increase the supply of metal

If the price of Taco Villa increases then the demand for Rosa's will

increase, shift to the right

An increase in the number of fast-food restaurants

increases the supply of fast-food meals

A supply schedule

is a table that shows the relationship between the quantity supplied and the price of a good

Starting in equilibrium, an increase in demand will

lead to an increase in equilibrium price and equilibrium quantity

Which of the following increase the supply of a product

lower prices for the resources used to produce the product

Teenagers drink more soda than other age groups. If the number of teenagers increases, everything else remaining the same

market demand for soda increases

The reason that PF Chang's would rather locate in Dallas than Pecos is because

number of buyers

The Law of Demand refers to the fact that, other things remaining constant,

price and quantity demanded move in opposite directions

The supply side of the market represents

producers

If the price of carrots is below the equilibrium price, the

quantity demanded of carrots exceeds the quantity supplied and a shortage exists

When there is a shortage of parking spaces at your college, the

quantity of parking spaces demanded is greater than the quantity of parking spaces supplied

The quantity supplied of a good or service is the

quantity produced at one price

An example of a price ceiling is

rent control

The downward slope of a demand curve

represents the law of demand

The law of market forces is the tendency for the price to

rise when there is a shortage and fall when there is a surplus

An increase in the number of buyers of a product will do what to demand

shift the demand curve to the right

Price $8 $7 $6 $5 Quantity Demanded 10 40 70 100 Quantity Supplied 90 80 70 60 Using the data in the table above, if the price of a stapler is $5, then there is a ______ of staplers and the quantity of staplers demanded ____ the quantity of staplers supplied

shortage; is greater than

A supply curve

slopes upward

Goods that can be used in place of one another are called

substitute goods

Market demand curves are obtained by

summing the quantities every consumer is willing to buy at each different price

Price $8 $7 $6 $5 Quantity Demanded 10 40 70 100 Quantity Supplied 90 80 70 60 Using the data for staplers above, if the price of a stapler is $8, then there is a ____ of staplers and the quantity demanded _____ the quantity of staplers supplied.

surplus; is less than

Suppose that scooters become popular with old people because it makes them feel cool. This gain in popularity best reflects which of the following influences on buying plans

tastes and preferences

The factor of demand that deals with how we feel about a product is

tastes and preferences

Which of the following does not impact the supply curve

tastes and preferences

The main reason that technology increases supply is

technology increases productivity

Demand is

the amount of a good or service that consumers are willing to buy at all prices in a given period

Supply is

the amount of a good or service that producers will make available for sale at all prices

What is the quantity demand

the amount of a good people are willing and able to buy during a specific time period and at a given price

Hot dogs and hot dog buns are complements, if the price of a hot dog falls, then

the demand for hot dog buns will increase

An inferior good is one that

the demand for will fall as income rises

If the demand for a good increases when people's incomes increase

the good is a normal good

If consumers preferences for a good increase, then

the good's demand curve shifts rightward

An example of a price floor is

the minimum wage

When a surplus occurs

the price falls

In a supply schedule, which of the following changes

the price of the good

When a shortage occurs

the price rises

Market equilibrium occurs when

the quantity demanded equals the quantity supplied

The law of demand refers to how

the quantity demanded of a good changes when the price of a good changes

According to the law of demand, if the price of hamburgers increases then

the quantity demanded of hamburgers will fall

A surplus occurs when

the quantity supplied is greater than the quantity demanded

A shortage occurs when

the quantity supplied is less than the quantity demanded

Quantity demand refers to

the specific amount that a consumer will buy at a specific price

The market demand curve for mangos is

the sum of the individual demand curves for all the buyers

If the automobile worker's union successfully negotiates a wage increase for its members, how does the wage hike affect the supply of SUV automobiles.

the supply decreases

Plywood is used in the construction of houses. If the price of plywood rises, what happens to the supply of houses

the supply decreases so that the supply curve shifts leftward

If hot dogs are considered an inferior good

then the demand for hot dogs will decrease when people's income increases

If the price is below the equilibrium price,

there is a shortage

Given this demand schedule, if the price of the good is $1 what is the quantity demanded? P Q 3 .5 2 1 1 2

2 (Since you can't see the question this is the answer)

Sonic raises its prices and more people start going to Stars (demand for Stars increases) then Sonic and Stars are

Substitutes

Price $100 $80 $50 $20 Quantity Demanded 50 55 60 100 Quantity Supplied 100 80 60 40 Using this table for cell phones, the equilibrium quantity and equilibrium price for a cell phone is

60,000 and $50

Price $8 $7 $6 $5 Quantity Demanded 10 40 70 100 Quantity Supplied 90 80 70 60 Using the table above for staplers, the equilibrium quantity and equilibrium price for a stapler is

70,000 and $6

A change in the price of a good can cause

(NOT) A change in demand

The law of demand implies that, other things remaining the same

(NOT) as the price of a cheeseburger rises, the quantity of cheeseburgers demanded increases

An increase in business regulations would tend to

(NOT) increase supply

An increase in supply can be represented by

A shifting of the supply curve rightward

An increase in the number of pineapple growers results in

An increase in the supply of pineapples and a rightward shift in the supply curve of pineapples

Anything that increases the costs of production and makes it more expensive to produce will

Decrease supply (shift the supply curve leftward)

During the great recession as people suffered a loss of income, the sale of Big Macs increased. Big Macs are

Inferior goods

A hurricane is approaching the Florida coast. From prior experience the people of Florida know that stores will be closed for several days and they will not be able to get food. What happens to the demand for food today

It increases

Starting at equilibrium, an increase in supply will do what to equilibrium price and quantity

P will fall and Q will rise

Starting in equilibrium, a decrease in supply will do what to equilibrium price and quantity

P will rise and Q will fall

A decrease in demand is shown as

a leftward shifting of the demand curve

A price ceiling is

a maximum legal price

An increase in supply is shown as

a rightward movement of supply

An increase in demand is represented as

a rightward shift of the demand curve

A change in demand causes

a shifting of the demand curve

A change in demand can be shown as a

a shifting of the entire demand curve

Price $100 $80 $50 $20 Quantity Demanded 50 55 60 100 Quantity Supplied 100 80 60 40 Using the table above for cell phones, at a price of $80 a phone

a surplus of 25,000 cell phones occurs

A price floor makes prices

below the price floor illegal

To be part of the supply for a good, a producer must be

both able and willing to supply the good

An increase in the price of a good or service will

cause a movement up the demand curve

Goods that are used together are called

complements

Mulch is shredded and is a by-product in the production of lumber. Because these two goods are produced together, they are

complements in production

The demand side of the market represents

consumers

Advances in productivity increases supply because they

decrease the cost of production

The graphical representation of the demand schedule is called the

demand curve

Car insurance and cars are complements. If the price of car insurance increases, the

demand for cars decreases

A table showing the various prices and associated quantity demand is called a

demand schedule

People come to expect that the price of a gallon will rise next week. As a result

today's demand for gasoline increases

Supply curves are

upward sloping