Micro Econ - Supply and Demand

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Nearly all supply curves share a basic similarity. They slope...

up from left to right

Which of the following will shift the supply curve to the left

An increase in the price of inputs to production

If a technology change reduces a company's production costs, it will...

Shift supply curve to the right

Good weather and heavy winter rain increases the supply of agricultural products. This means that at any given price, a higher quantity will be supplied. Conversely, a drought would shift the

Supply curve to the left

If supply falls and demand remains constant, once the market has adjusted to its new equilibrium there will be

fewer transactions, and they will take place at a higher price.

A change in technology that reduces the costs of production will

shift the supply curve to the right

A severe freeze has damaged the Florida orange crop. The impact on the market for orange juice will be a leftward shift of

the supply curve

Suppose Congress passes legislation that offers subsidies to orange farmers. The impact on the market for orange juice will be a rightward shift of

the supply curve

At a price of $13, quantity demanded is ________, quantity supplied is ________, therefore excess ________ has occurred.

45; 27; Excess Demand

The conditions of demand and supply are given in the table below. What is the equilibrium quantity?

7,500

Which of the following will shift the supply curve to the right?

A decrease in the price of inputs to production.

When ________, business firms will collectively supply a higher quantity of output at any given price, and the supply curve will shift to the right.

Costs of production fall

When the price of a particular good increases

Demand for complementary good falls AND

When the actual price in some market is above the equilibrium price, the resulting market condition is known as

Excess supply

Which of the following statements describe(s) a free market?

Government does not intervene in any way

According To The Law Of Demand, Assuming Other Factors Are Held Constant as...

NOT The price of bread increases, the quantity of bread demanded will increase

An increase in the quantity supplied can be the result from

NOT an increase in supply

If an increase in the price of Nike shoes increases the demand for Adidas shoes, this means that

Nike shoes and Adidas shoes are substitutes

If demand deceases and supply remains constant, what happens to the market equilibrium?

Quantity rises and price falls

In order to deal with a budget deficit, the city of Portland reduces its subsidy of doughnut shops. What happens in the market for doughnuts in Portland?

The equilibrium quantity falls; doughnut prices rise.

Information campaigns about tobacco hazards and taxes on tobacco are two ways to discourage its use. Which one decreases demand for smoking?

The information campaign on hazards of tobacco

When quantity demanded decreases in response to a change in price

There is a movement from one point to another along the demand curve

An decrease in the quantity supplied can be the result from

a decrease in price

When economists talk about supply, they are referring to a relationship between the price in a market and the

amount that producers collectively make available for sale.

The law of demand states that as the price of a good decreases

buyers desire to purchase more of it

If demand falls and supply remains constant, once the market has adjusted to its new equilibrium there will be

fewer transactions, and they will take place at a lower price

Decreased competition due to fewer producers in a market will cause

higher prices due to an decrease in the quantity supplied at every price.

Complete the following sentence: If people think that the price of electronics will increase in the near future, that belief may cause a(n) Group of answer choices

increase in the demand for electronics today

What would cause the level of demand (meaning the relationship between price and quantity demanded) to shift?

population grows in a particular market area

A demand curve shows the graphical relationship between quantity demand and

price

Economists refer to the relationship that a higher price leads to a lower quantity demanded as the

the law of demand

When higher prices result in a lower quantity demanded, economists call this relationship

the law of demand

In a planned economy, government determines the prices for goods and services, and

what goods will be produced

In a planned economy, government determines what can be produced and

what prices will be charged


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