Economics chapter 3
When quantity supplied exceeds quantity demanded?
A surplus occurs and prices are pushed down toward equilibrium.
The supply curve slopes up and to the right because?
Due to the increasing opportunity cost, producers must charge more to purchase more in order to cover their losses.
When the supply shifts from S0-S1, the equilibrium price changes from?
$40-$60
suppose the Terrific Tube Company ran a very successful advertising campaign. Economic analysis would suggest that the campaign would cause the equilibrium price to ____ and the equilibrium quantity to ____
Rise, Rise
Electricity is essential in the production of aluminum. What will happen if electricity prices increase?
The supply curve for aluminum shifts leftward
If the producers of cotton shirts face higher cotton price, which of the following is likely to occur?
The supply of cotton shirts decrease, the equilibrium price of cotton shirts rise, and the equilibrium quantity falls
When quantity demanded in a market equals quantity supplied, then?
Market is in equelibrium
When demand increases, the demand curve?
Shifts to the right
Supply is defined as
The amount of product a seller is willing to place into the market for sale.
What will happen at any price below equilibrium price?
The quantity demanded exceeds the quantity supplied in the market.