Ag Eco Chapter 3

The introduction of rent controls could lead to which of the following? An excess supply of available apartments. An decrease in the quantity of apartments available for rent. Lower rent for those who live in rent-controlled apartments.

-An decrease in the quantity of apartments available for rent. -Lower rent for those who live in rent-controlled apartments.

The smallest amount you would have to pay Bronx Pizza to get them sell an additional cheese pizza is $8.84. Thus, $8.84 is

Bronx Pizza's reservation price.

A shift in the entire demand curve is considered ______.

a change in demand

A movement along the demand curve is considered ______.

a change in the quantity demanded

If Red Bull and Coke are substitutes, then a decrease in the price of Red Bull should lead to: an increase in the amount of Coke bought and sold in the market. a decrease in the amount of Coke bought and sold in the market. an increase in the price of Coke. a decrease in the price of Coke.

a decrease in the amount of Coke bought and sold in the market. a decrease in the price of Coke.

If hot dogs and ketchup are complements, then an increase in the price of ketchup will lead to: a decrease in the price of hot dogs. an increase in the number of hot dogs bought and sold in the market. an increase in the price of hot dogs. a decrease in the number of hot dogs bought and sold in the market.

a decrease in the price of hot dogs. a decrease in the number of hot dogs bought and sold in the market.

Suppose that as the price of coffee increases, consumers purchase less coffee in part because they can no longer afford to buy as much coffee as they used to. This reduction in the quantity of coffee demanded is known as the _____ of a price change.

income effect

Along a supply curve, if the price of butter increases, the quantity of butter supplied will _____.

increase

A buyer's reservation price is the

largest dollar amount the buyer would be willing to pay for a good.

Suppose that as the price of pencils increases, people buy fewer pencils and instead use pens. The resulting reduction in the quantity of pencils demanded is known as the _____ of a price change.

substitution effect

A schedule or graph showing the quantity of a good that sellers wish to sell at each price is known as a _____.

supply curve