Test prep 4

an increase in demand.

Any change that leads consumers to buy a larger quantity at each price is considered:

a decrease in demand.

Any change that leads consumers to buy a smaller quantity at each price is considered:

brick-and-mortar store

A coffee shop is an example of a(n):

fall; rise

A decrease in supply causes quantity to _____ and price to _____.

bundling of extras. queuing. a secondary market.

A market in disequilibrium is identified by all of these symptoms

the quantity of shirts at a store

All of these are considered "prices" in a market EXCEPT:

prices of complements and substitutes. the number and type of consumers. congestion and network effects.

All of these are shifters of demand

equilibrium price.

An increase in supply holding demand constant creates a decrease in:

lower; rise

An increase in supply will cause equilibrium price to _____ and equilibrium quantity to _____.

there is no tendency for change.

At the equilibrium point:

When the quantity supplied equals the quantity demanded.

At what point is a market in equilibrium?

they bring buyers and sellers together.

Auction houses, coffee shops, and the New York Stock Exchange are different, and yet they are all considered markets because:

same; opposite

Demand shifts lead price and quantity to go in the _____ direction, and supply shifts lead price and quantity to go in the _____ direction.

Demand is high, so price is high.

Dr. Larson is a professor at a state university. He is known for being tough but fair in his grading, and rarely gives out A's on his assignments. Considering that Dr. Larson is on the supply side and his students are on the demand side, why is it so difficult to attain an A?

planned economies.

Economies such as Cuba, where centralized decisions are made about production, are referred to as: Please choose the correct answer from the following choices, and then select the submit answer button. Answer choices

The quantity demanded exceeds the quantity supplied.

If prices are rising, what can be stated about the observed market?

supply

In the market for grades, the professor is on the _____ side.

He is supplying the bank with his savings, which the bank will in turn lend out to other borrowers.

Krishan goes to a local bank to make a deposit in his savings account. While there, he considers the principles of economics that he has been learning at the university. He concludes that in this situation he is a supplier of credit. How is this so?

quantity demanded

Movement along the demand curve due to a change in price is referred to as a change in _____

suppliers realize they can raise their prices and still sell all their goods and earn a higher profit.

Prices rise during a shortage because:

supplier; demander

Stella owns a gas station that Ezekiel frequents. In terms of the market for gasoline, Stella is the _____ and Ezekiel is the _____.

cost and benefit

Supply and demand can also be thought of as:

current buying plans.

The market demand curve summarizes people's:

the equilibrium price.

The price at which the market is in equilibrium is:

lower; lower

There is a decrease in demand. This means the new equilibrium price will be _____ and quantity will be _____. Please choose the correct answer from the following choices, and then select the submit answer button. Answer choices

Each individual makes their own production and consumption decisions.

What are the characteristics of a market economy?

Which shift is bigger

What determines the total effect when there is a shift in both the supply and demand curves?

Expectations

What factor can be a shifter of BOTH supply and demand?

equilibrium price increases and equilibrium quantity increases

What happens to equilibrium price and quantity when there's an increase in demand?

Anything that adds on to the nominal price of a good

What is the "effective price"?

high

When demand in the market is high, price is _____.

movement along the supply curve.

When firms change their quantity supplied in response to a change in price, it is considered a:

shortage

When quantity demanded exceeds the quantity supplied, a(n) _____ occurs. Please choose the correct answer from the following choices, and then select the submit answer button. Answer choices

demander

When running your own business, you become a _____ in the labor market when seeking out employees to hire. Please choose the correct answer from the following choices, and then select the submit answer button. Answer choices

shortage leads to price increases.

When the price is below equilibrium, a:

discount

When there is a surplus in the market, stores will _____ the good until it reaches the equilibrium price.

decrease

a pair of substitute goods. If the price of one good decreases, then demand for the other good will:

there is no physical space for buyers to go and bid on items.

eBay is considered an online auction because:

In equilibrium:

every seller who wants to sell an item can find a buyer, and every buyer can find a potential seller