macro ch3

Which of the following factors increase the demand for any good or service?

-An increase in the number of buyers -An increase in the price of a substitute good -A rise in consumer income if the product is a normal good

Select all that apply Which of the following would result in a change in supply?

-An increase in the number of shoe stores at the local mall -An increase in the excise tax on cigarettes -An increase or decrease in wages

Select all that apply In which of the following situations do governments intervene to prevent prices from rising above or falling below their equilibrium levels?

-Prices are too high for consumers. -Prices are too low for firms.

Equilibrium price in a market changes when there is a change in which of the following?

-Supply -Demand

Select all that apply Which of the following are determinants of supply?

-Taxes and subsidies -Technology -Resource prices -Producer expectations -Taxes and subsidies -Prices of other goods

Select all that apply In general, what goals does the improvement of production techniques help companies to achieve?

-Use fewer resources per unit of output -Lower production costs -Increase supply

Price controls or ______ mandated in the apartment rental market benefit the consumer by establishing a price ______ the free market equilibrium price.

-ceilings; -below

At the equilibrium price, quantity ---equals quantity ---.

-demand -supply

Select all that apply Equilibrium price in a market changes when there is a change in which of the following?

-demand -supply

At the market ---- price, quantity demanded equals quantity ----

-equilibrium -supplied

Government may place legal limits on prices when it is determined that prices are unfairly ---- (high/low) for buyers or unfairly lowBlank 2Blank 2 low ----- (high/low) for sellers.

-high -low

Select all that apply If the government of a country subsidizes the production of a good, it:

-lowers the cost of production. -increases supply.

The interaction between buyers and sellers, which determines the equilibrium---- and ----, is illustrated by the intersection of the demand and supply curves. (Enter only one word in each blank.) Listen to the complete question

-price -quantity

Select all that apply Government-controlled prices cause ______.

-surpluses -shortages -distortions in resource allocation

An increase in equilibrium price and indeterminate effect on equilibrium quantity is a result of which of the following?

A decrease in supply and a simultaneous increase in demand

___,while holding demand constant, results in an increase in the equilibrium price of the good, but a decrease in the equilibrium quantity of the good.

A decrease in the supply of a good

Which of the following in the rental market for housing benefits renters, but makes it unprofitable for suppliers or landowners?

A price ceiling

Which of the following refers to government financial assistance for the production of a good which lowers producers' costs and increases supply?

A subsidy

Which of the following refers to a particular apportionment or mix of goods and services most highly valued by society?

Allocative efficiency

Which of the following reflects an increase in demand, while holding supply constant?

An increase in both equilibrium price and quantity

A decrease in equilibrium price and indeterminate result on equilibrium quantity is a result of which of the following?

An increase in supply and a simultaneous decrease in demand

How do improvements in productive technology enable firms to produce more units of output?

By utilizing fewer resources, thereby lowering costs

Which of the following shows the effects on equilibrium price and quantity due to an increase in supply and a simultaneous decrease in demand?

Equilibrium price falls and the change in equilibrium quantity is indeterminate.

Which of the following describe the effects on equilibrium price and equilibrium quantity as a result of a decrease in supply and a simultaneous increase in demand?

Equilibrium price rises and the change in equilibrium quantity is indeterminate.

True or false: A change in supply is represented by a movement along the curve, not a shift of the curve.

False

True or false: A price at or above the price floor is illegal.

False

Which of the following causes shortages or surpluses, distortions in resource allocation, and negative side effects?

Government-controlled prices

In which of the following situations will quantity supplied exceed the quantity demanded?

In the imposition of a price floor.

Which of the following does not exemplify an improvement in technology affecting supply?

Increased subsidies to farmers for producing more corn

What is the additional utility gained from consuming one more unit of a good or service?

Marginal benefit

Which of the following is the most important factor for a producer in determining how much of a product to produce?

Price

Which of the following describes the effects on equilibrium price and equilibrium quantity as a result of a simultaneous increase in supply and demand?

The change in price is indeterminate and quantity rises.

What is the price where the intentions of buyers and sellers match?

The equilibrium price

What determines market price and equilibrium output in a market?

The interaction of buyers and sellers

Other things equal, which of the following is correct regarding increasing the number of sellers in an industry?

The market supply becomes greater

What does allocative efficiency refer to?

The particular mix of goods most highly valued by society

Which of the following does not shift the supply curve?

The price of the product itself

At equilibrium quantity, which of the following is true?

The quantity demanded equals quantity supplied.

True or false: Resource costs or changes in these costs to production are responsible for shifts in the supply curve. True false question.

True

A decrease in demand while holding supply constant results in ______ in both equilibrium price and quantity.

a decline

A decrease in demand while holding supply constant results in _______.

a decrease in both equilibrium price and quantity

An increase in the equilibrium price of a good and an indeterminate change in the equilibrium quantity is the result of ______.

an increase in demand and decrease in supply

The effects on equilibrium price and quantity due to an increase in supply and simultaneous increase in demand are shown by ______.

an increase in the equilibrium quantity and an indeterminate change in price

The supply curve is ______ sloping curve.

an upward

At any price below equilibrium price, or price ceiling, quantity demanded will ______ quantity supplied resulting in a persistent excess demand or shortage of product.

be greater than

The rationing function of prices refers to the ability of the competitive forces of supply and demand to establish a price at which ______..

buying and selling decisions are consistent

A price ----(floor/ceiling) is the maximum legal price a seller may charge for a product or service.

ceiling

The ______ incurred by firms when producing a good or service arise from the prices of the inputs that are used to produce said good or service.

costs of production

An increase in business taxes causes a(n) ______ in supply and will ______ production costs.

decrease; increase

An increase in supply while holding demand constant results in a(n) ______ in equilibrium price, but a(n) ______ in equilibrium quantity.

decrease; increase

A change in supply or a change---- in will disturb equilibrium price.

demand

A shortage results from an excess of quantity _____.

demanded

With a price ceiling, the quantity of a product----- will exceed quantity----- , resulting in a persistent shortage of the product.

demanded -supplied

When a price ceiling is established, the new price and quantity are now at ______.

disequilibrium

The interaction between buyers and sellers determines the equilibrium price and the--- quantity. (Answer in one word.)

equilibrium

The---- (one word) output is the quantity at which quantity demanded equals quantity supplied in a competitive market.

equilibrium

the interaction between buyers and sellers determines the equilibrium price and the -----quantity. (Answer in one word.)

equilibrium

Changes in ______ about the future price of a product may affect the producer's current willingness to ______ that product

expectations; supply

If a decline in demand is greater than an increase in supply, the equilibrium quantity will ______.

fall

True or false: A change in one of the determinants of supply results in a movement along the supply curve.

false

True or false: An increase in the sales, property or any other tax will decrease production costs and increase supply.

false

A government-set minimum price, such as for agricultural products, is called a price----

floor

A price--- (one word) is a minimum price fixed by the government, generally imposed above the equilibrium price.

floor

Producer expectations refer to firms' expectations of ______ for a good or service that they produce.

future prices

At any price above the equilibrium price, such as with a price floor, quantity supplied will be ______ the quantity demanded, resulting in a persistent excess supply or surplus of the product.

greater than

______ resource prices raise production costs and, assuming a fixed product price, ______ profits.

higher; reduce

An increase in demand while holding supply constant results in a(n) ______ in both equilibrium price and quantity.

increase

If producers expect lower prices for their goods or services in the future, they will ______ now, which is illustrated by a shift of the supply curve to the ______.

increase their supply; right

A decrease in supply while holding demand constant results in a(n) ______ in equilibrium price, and a(n) ______ in equilibrium quantity.

increase; decrease

An increase in the sales, property, or any other tax will ______ production costs and ______ supply.

increase; decrease

Greater resource prices _______ the costs of production, thereby, ______ the incentive for firms to produce the good at each price.

increases; reducing

Government subsidies of the production of a good has the effect of ______.

increasing supply

As firms leave an industry, supply decreases. This is illustrated as a shift of the supply curve to the

left

A price ceiling is the maximum legal price a seller may charge for a product or service where a price at or below the ceiling is ______ and a price above the price ceiling is ______.

legal; illegal

If costs of production rise, the producer has an incentive to produce----(one word) output.

less

If the government subsidizes the production of a good, it in effect ______ the producers' costs and ______ supply.

lowers; increases

----- benefit is the additional utility gained from consuming one more unit of a good or service.

marginal

The added cost of producing one more unit of output is called ---cost.

marginal

The demand by a consumer for a good or service essentially reflects the ______ of the good or service, based on the utility received.

marginal benefit

The ongoing supply of a good or service by a producer essentially reflects the ______ of producing the good or service.

marginal cost

The equilibrium price where the quantity demanded equals the quantity supplied is otherwise known as the -----clearing price.

market

On a simple supply model, a change in quantity supplied is illustrated by a ______ and a change in supply is illustrated by a ______.

movement along the supply curve; shift of the supply curve

The determinants of the supply of a good are any factors other than the product's ______ that cause the supply curve of the good to shift.

price

The only factor that causes a movement along the supply curve is:

price

When drawing a supply curve, _____ is labeled on the vertical axis.

price

According to the law of supply, which two things are directly related?

price and quantity supplied

The supply curve illustrates the relationship between ______

price and quantity supplied

The determinant of supply dealing with alternative products that can be produced by firms is called ______.

price of substitutes in production

A change in ______ causes a movement along the supply curve.

product price

The production of a good or service in the least costly way is known as ______ efficiency.

productive

Competition among corn producers forces them to use the best technology and right mix of productive resources; otherwise their costs will be too high relative to the market price and they will be unprofitable. This is best described as ______.

productive efficiency

A change in ______ causes the supply curve of a product to shift leftward or rightward.

resource prices

The prices of the ----(one word) used in the production process help determine the costs of production incurred by firms

resources, or inputs, or input

If an increase in supply is larger than a decrease in demand, the equilibrium quantity will ______.

rise

If the decrease in the supply of a good is greater than the decrease in the demand for the good, the equilibrium price will ______.

rise

If the increase in demand is greater than the decrease in supply, the equilibrium quantity will ______.

rise

When a price ceiling is enacted, the new price is established below the old equilibrium price, quantity demanded ______ and quantity supplied ______ thus creating disequilibrium.

rises; falls

The supply curve measures quantity ______ on the horizontal axis and ______ on the vertical axis.

supplied; price

A change in ---, rather than a change in the quantity supplied, means a change in the schedule or a shift of the supply curve.

supply

A surplus is also known as excess ______.

supply

An increase in--- while holding demand constant, results in a decrease in equilibrium price, but an increase in equilibrium quantity.

supply

Improvements in technology is a determinant of ______.

supply

Producer expectations of future prices are a determinant of --- (one word).

supply

The ______ of a good or service by a producer essentially reflects the marginal cost of producing the good or service.

supply

The number of sellers or competitors in a market is a determinant or shifter of the ---(one word) curve.

supply

The prices of substitute goods in production is a determinant of---

supply

When the number of sellers or producers in an industry increases, ______ of a particular good or service will _____. When the number of sellers in an industry ______, supply of a particular good or service will ______.

supply; rise; decreases; fall

Price floors are invoked when a society feels that ______ sufficient income for resource suppliers or producers.

the free market has not provided

The ability of the competitive forces of supply and demand to establish a price at which selling and buying decisions are consistent is called ______.

the rationing function of prices

Equilibrium price and equilibrium quantity occur where ______.

the supply curve intersects the demand curve

An increase in the number of hair salons will cause:

the supply curve of hair salon services to shift to the right

True or false: A surplus is when quantity supplied exceeds quantity demanded. True false question.

true