Econ Quiz 3 – Flashcards
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Which of the following is an implication of the law of supply?
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Producers will offer more units at a higher price and fewer units at a lower price.
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The law of supply then implies that a ___ the supply curve occurs due to change in market price.
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Movement along.
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The market price of paper increases. This will cause a
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decrease in supply.
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The market price of economics textbooks increases. This will cause an
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increase in quantity supplied.
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The number of publishers of economics textbooks increases. This will cause an
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increase in supply.
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Publishers expect that the market price of economics textbooks will increase next month. This will cause a
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decrease in supply.
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Other things remaining equal, the law of demand says that higher prices will lead to a
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smaller quantity demanded and lower prices to a larger quantity demanded.
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This would cause smartphone ___ to ___ causing the equilibrium price to ___ and the equilibrium quantity to ___.
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a. supply
b. increase
c. decrease
d. increase
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If the demand and supply curves increase (shift outward) by identical proportions then
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equilibrium price stays the same and quantity rises.
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What if the increase in demand were larger than the increase in supply?
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The equilibrium price and quantity increase.
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What if the increase in demand were smaller than the increase in supply?
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Equilibrium price falls and quantity rises.
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The law of supply states that
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as price increases, quantity supplied decreases, all other things equal.
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Equilibrium quantity would ___. Equilibrium price would ___.
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a. decrease
b. decrease
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All of the following will decrease the supply of train trips except
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a technological change that makes trains safer and more fuel-efficient.
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All of the following pairs of goods are substitute except
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we observe the price of bacon increases and the demand for eggs decreases.
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All of the following pairs of goods are complements except
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we observe the price of coffee decreases and the demand for tea decreases.
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The law of supply states that there is a ___ relationship between the price and _____.
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a. positive
b. the quantity supplied
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Thus, as the price decreases,
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the quantity produced by firms decreases.
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According to the law or supply, as the price of the good decreases, it causes
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a movement downward along the supply curve.
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Which of the following good is an inferior good?
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When consumer income increases, the demand for eggs decreases.
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At the market equilibrium price,
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quantity demanded equals quantity supplied.
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Which of the following is consistent with the law of supply?
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An increase in the market price of oranges causes an increase in the production of oranges.
