Supply and Demand Recitation Quiz - Ritter
If people expect the price of SUVs to decrease in the future, then the demand for the Toyota Rav4 SUV would __________.
decrease - shift left
The concept of diminishing marginal benefits means that __________.
each additional unit consumed is worth less to you than the previous one.
For a trade to take place, a buyer's willingness to pay must be ____________.
either higher than the seller's willingness to accept or equal to the seller's willingness to accept.
market demand is derived by __________.
fixing the price and adding up the quantities that each buyer demands.
the concept of diminishing marginal benefits ________________ for goods that you like a lot.
holds true
If Honda decided to increase the price of its Honda CRV SUV, then the demand for the Toyota Rav4 SUV would __________.
increase
If the number of people over the age of 16 in the country increased significantly, then the demand for the Toyota Rav4 SUV would __________.
increase
If Honda decided to increase the price of its Honda CRV SUV, then the demand for the Toyota Rav4 SUV would __________.
increase - shift right
An aggregated demand curve is created by summing the _______________________ on the __________________
quantity demanded at each price, individual demand curves
The Law of Demand states that as the price of a good increases, the ___________ decreases. This can be shown graphically with ___________________ demand curve or numerically in a table using a demand schedule
quantity demanded, a downward-sloping
When one of the five major factors changes, causing an increase in demand, the demand curve shifts
rightward
The supply curve represents ___________.
the minimum price sellers are willing to accept to sell an extra unit of a good.
The concept of diminishing marginal benefits states that
the more you consume of a good, your willingness to pay for an additional unit declines.
If the government sets a minimum wage for seasonal workers, then the supply curve for sparkling wine would __________.
decrease
If the number of sellers of sparkling wine decreases significantly, then the supply curve for sparkling wine would __________.
decrease
Which of the following would not be considered a market by an economist?
A dating website An online auction site such as ebay Your corner gas station
Are all markets perfectly competitive?
No, there are other market types where firms have considerable power to control the price.
Suppose you have a flashlight that takes three batteries to power it. If you buy the batteries one at a time, for which purchase will diminishing benefits set in?
When you buy the fourth battery.
In a perfectly competitive market, sellers _________ and buyers _________.
cannot charge more than the market price; cannot pay less than the market price.
Holding all else equal, if the price of a digital camera rises, then we can expect
a decrease in the quantity demanded of digital cameras.
What is meant by holding all else equal and how is this concept used when discussing movements along the demand curve?
all variables that can affect the demand for the good are held constant
In a perfectly competitive market, if one seller chooses to charge a price for its good that is slightly higher than the market price, then it will _________.
lose all or almost all of its customers.
A demand curve has a ------ slope due to the Law of Demand. The Law of Demand is based off of a consumer's willingness to pay -------- as marginal units are consumed.
negative, less
We make the assumption of holding all else equal when considering demand curves since we want to focus on the changes in the quantity demanded that result from changes in ________________________________ .
only the price of a good
Which of the following is not one of the four major factors that shifts the supply curve when it changes?
price of good itself
Which change causes a movement along the demand curve?
price of the good itself
Which is not one of the five major factors that shifts the demand curve when it changes?
prices of imputs used to produce the good
The lowest price that a seller is willing to receive to sell an extra unit of a good is called
willingness to accept
the highest price that a buyer is willing to pay for an extra unit of a good is called
willingness to pay
Does the shape of the market demand curve differ from the shape of an individual demand curve?
No, they both tend to be downward-sloping curves.