MICRO CHAP 3
(Figure: Supply and Demand for Shoes) If the price of shoes is $20, then the market:
is experiencing a shortage of shoes.
A good is a normal good if:
the demand curve shifts outward if income increases.
The law of demand states that
the lower a product's price, the more of that product consumers will purchase during a given period.
(Figure: Market for Shoes) If the price of shoes is $40 per pair, the quantity demanded will be _____ pairs of shoes.
15
In the market for Chinese take-out, suppose that the price of Sushi take-out, a substitute, decreases in price. What will happen to the demand for Chinese take-out?
Demand for Chinese take-out will decrease.
Which factor would NOT cause the demand curve for green tea to shift to the right?
a decrease in the price of green tea
Table) In the table, at a price of $12:
a surplus of 20 units occurs
Which factor would shift the demand curve for gasoline to the right?
an increase in national income
Butter is a substitute for margarine. If the price of margarine drops, we would expect to see:
both the price of butter and quantity of butter fall.
(Figure: Interpreting Demand Curves) In the demand curve shown, an increase in price from $1 to $2 will:
cause quantity demanded to fall from 30 units to 20 units.
When a large factory closed in the town of Greenville, income fell for many residents. As a result, demand for normal goods would _____ and demand for inferior goods would _____.
decrease; increase
A decrease in demand causes the equilibrium price to _____ and the equilibrium quantity to _____
fall;fall
(Figure: Demand for Shoes) A shift to the right of the demand curve could be caused by a(n):
increase in income if the good is a normal good.
The supply curve represents the _____ price at which a firm is willing to _____.
minimum; sell various quantities of a good
There is a(n) _____ relationship between price and quantity demanded.
negative
If the demand for iPhones rises as incomes increase, then the iPhone is a(n) _____ good.
normal
Which enterprise is NOT an example of a market?
painting one's house
The law of supply states that as prices _____, the quantity _____.
rise; supplied rises
The graph represents the market for water park admissions. If the price of admission is set at $50, this would result in a _____ of _____ units
surplus; 200
A surplus exists:
when quantity supplied exceeds the quantity demanded.