Demand, Supply, and Consumer Choice
downward sloping
the law of demand if illustrated by a demand curve that is
a greater quantity supplied than quantity demanded
a price floor above equilibrium will result in
quantity demanded is greater than quantity supplied
a shortage in a market will occur when
quantity supplied to decrease
according to the law of supply, if the price of a produce decreases, one would expect
the supply will decrease, the demand will increase, and the equilibrium price will rise
after a celebrity is seen sporting a wearable fitness device, everyone decides to try one. Meanwhile, the price of palladium, an important component in electronics, increases. Based on this information, what can we expect in the market of wearable fitness devices
a leftward shift of the supply curve for that good or service
an increase in the cost of any factor of production for a good or service will result in
a country and western dance trend spreads across the country
ceteris paribus, consumers will wish Toby more cowboy boots at each and every price if
upward pressuring on pricing
given a price below equilibrium for any given good or service, we would expect
the supply of bacon would increase, the demand for bacon would decrease, and the price of bacon would fall
ham and bacon both come from pigs (from different parts of the pig). If the rice of ham increases at the same time as the global population shrinks, what would happen to the market for bacon
people moving into the city will be unable to find an apartment
if a majority city imposes a price ceiling on rent payments for apartments. what will most likely occur
the change in equilibrium price will be unknown and the equilibrium quantity will decrease
if the demand for pianos decreases at the same time as the supply of pianos decreases, what will happen to equilibrium and price and quantity
the equilibrium will increase and the change in equilibrium quantity is unknown
if the demand for sweaters increases at the same time as the supply decreases, what will happen to the equilibrium price and quantity
there is a surplus of the product
if the quantity supplied is greater than the quantity demanded, then
the change in equilibrium price will be unknown and the equilibrium quantity will increase
if the supply of coffee increases at the same time as the demand for coffee increases, what will happen to the equilibrium price and quantity of coffee
decrease
in booming economic times we would expect demand for inferior goods to
price ceilings go below equilibrium and result in a shortage
price ceilings go ____ equilibrium and result in a ____
Price floors go above equilibrium and result in a surplus
price floors go ___ equilibrium and result in a _____
quantity demanded of movie tickets to decrease
the price of a movie ticket increases from 12 to 15 dollars. We can expect
1. Preferences or consumer taste 2. Number of Consumers in the market 3. Consumer Information (smoking or cholesterol) 4. Expectations of future prices (consumer will buy more now if prices are expected to rise in future (gas) 5. Price of related goods - substitutes and complements
what changes demand (5 shifters of demand)
a change in the price of a good or service
what changes quantity demanded (moving along the curve)
a change in the price of a good or service
what changes quantity supplied`
1. Technology 2. Number of firms in the market 3. Change in input price of land, labor, and capital - price of goods used in production 4. Expectations of future prices - firms will sell less raw if prices are expected to rise, farmers, may store goods to sell next year 5. Government taxes subsidies and regulations
what changes supply (5 shifters of supply)
when the demand is higher then the supply
what is a shortage
when the supply is higher then the demand
what is a surplus
they have an inverse relationship: when price goes up quantity goes down when price goes down quantity goes up
what is the relationship between price and quantity for the law of demand
they have an direct correlation: when price goes up quantity goes up when price goes goes down quantity goes down
what is the relationship between price and quantity for the law of supply
Inverse relationship: If income increases then demand for inferior goods decreases If income decreases then demand for inferior goods decreases
what is the relationship of income and demand for inferior goods
Direct relationship: If income increases then demand for normal goods will increase If income decreases then demand for normal goods will decrease
what is the relationship of income and demand for normal goods
Inverse relationship: If price of good increases the demand for its complement will decrease if price of good decreases the demand for its complement will increase
what is the relationship of price and demand of complements
Direct relationship: If price of good increases demand for its substitute increases if price of good decreases demand for its substitute decreases
what is the relationship of price and demand of substitutes
shortage
when quantity demanded is greater than quantity supplied, we would expect a(n)
price will increase and quantity is indeterminate
when the demand curve shifts to the right and the supply curve shits to the left, we can expect the following outcome
shift of the supply curve to the right
when the supply of a good or service increases at each and every price, we represent this on a graph by a(n)
designer jeans
which of the following best fits the label of a normal good
it's downward slope represents an inverse relationship between price and quantity
which of the following is true regarding a demand curve
prices of new generation smart phones increase in 20151
which of the following news scenarios would trigger a decrease in the quantity demanded for the stated technology
decreased availability of raw materials used to produce that good or service
which of the following scenario will shift the supply curve for a good or service to the left
an increase in the price of soccer balls because soccer balls are a complement to soccer cleats and causes the curve to shift whereas an increase the price of soccer cleats causes a move along the curve instead of a shift of the curve
which of the following things would cause a decrease in the demand for soccer cleats and why
an increase in the price of cotton
which of the following things would cause a decrease in the supply of cotton t-shirts
a recession ends and the average disposable income rises
which of the following things would cause an increase in the demand (i.e., shift in the curve for coffee)
an increase in the price of cheese (an input for cheeseburgers)
which of the following would cause the equilibrium price of cheeseburgers to increase and the equilibrium quantity of cheeseburgers to decrease
per unit excise tax increase
which of the following would have the same generalized effect as a supply shift left
II only
which of the following would increase the quantity supplied of a product: I. Technological improvements II. Increase in price for the product III. Decrease in business taxes
1. Diminishing marginal utility 2. Substitute effect 3. Income effect
why is demand downward sloping
At higher prices, profit seeking firms have an incentive to produce more the more they make the more they will get
why is supply upward sloping