ECO quiz 4
A ______________ is a group of buyers and sellers of a particular good or service.
market
Suppose that when income rises, the demand curve for computers shifts to the right. In this case, we know computers are
normal goods
When drawing a demand curve,
price is on the vertical axis and quantity demanded is on the horizontal axis.
When supply and demand both increase, equilibrium
price may increase, decrease, or remain unchanged
A market demand curve shows how the total quantity demanded of a good varies as
price varies
Which of the following would shift the supply curve for gasoline to the right?
An increase in the number of producers of gasoline
When the price of a good is higher than the equilibrium price,
sellers desire to produce and sell more than buyers wish to purchase
Suppose roses are currently selling for $20 per dozen, but the equilibrium price of roses is $30 per dozen. We would expect a
shortage to exist and the market price of roses to increase.
A technological advance will shift the
supply curve to the right
A shortage exists in a market if
the current price is below its equilibrium price.
Soup is an inferior good if
the demand for soup falls when income rises
Suppose that demand for a good increases and, at the same time, supply of the good decreases. What would happen in the market for the good?
Equilibrium price would increase, but the impact on equilibrium quantity would be ambiguous.
Suppose the number of buyers in a market increases and a technological advancement occurs also. What would we expect to happen in the market?
Equilibrium quantity would increase, but the impact on equilibrium price would be ambiguous.
Individual demand curves are summed ________ to obtain the market demand curve.
Horizontally
If something happens to alter the quantity supplied at any given price, then
the supply curve shifts
What would happen to the equilibrium price and quantity of coffee if the wages of coffee-bean pickers fell and the price of tea fell?
Price would fall and the effect on quantity would be ambiguous.
When quantity demanded exceeds quantity supplied at the current market price, the market has a shortage and market price will likely rise in the future to eliminate the shortage.
True
When the market price is below the equilibrium price, the quantity of the good demanded exceeds the quantity supplied.
True
Whenever a determinant of supply other than price changes, the supply curve shifts.
True
A decrease in income will shift the demand curve for an inferior good to the right.
True
A decrease in supply will cause an increase in price, which will cause a decrease in quantity demanded.
True
The quantity demanded of a product is the amount that buyers are willing and able to purchase at a particular price.
True
In a competitive market, the quantity of a product produced and the price of the product are determined by
all buyers and all sellers.
When we move along a given supply curve,
all nonprice determinants of supply are held constant
Today, people changed their expectations about the future. This change
can affect today's demand
The line that relates the price of a good and the quantity demanded of that good is called the
demand curve, and it usually slopes downward
Which of the following events will definitely cause equilibrium price to fall?
demand decreases and supply increases
The unique point at which the supply and demand curves intersect is called
equilibrium
If the demand for a product decreases, then we would expect
equilibrium price and equilibrium quantity to both decrease
If the supply of a product increases, then we would expect
equilibrium price to decrease and equilibrium quantity to increase
