Which statement applies to a substitute good
Faces increasing demand when the price of something similar falls
Can be used to replace something else to meet consumers’ needs
An increase in income will result in an increasein the demand for it
Is utilized in combination with another good
How would an decrease in supply be illustrated?
A movement up the supply curve
A movement down the supply curve
A shift to the left of the supply curve
A shift to the right of the supply curve
When the quantity demanded equals quantity supplied
the government must be intervening in the market
there is a shortage
there is a surplus
none of the above
A price below the equilibrium price results in
a further price fall
a shortage
excess supply
a surplus
People buy more of good 1 when the price of good 2 rises. These goods are
normal goods
complements
substitutes
inferior goods
Which of the following correctly describes how price adjustments eliminate a shortage?
As the price falls, the quantity demanded increases while the quantity supplied decreases
As the price rises, the quantity demanded decreases while the quantity supplied increases
As the price falls, the quantity demanded decreases while the quantity supplied increases
As the price rises, the quantity demanded increases while the quantity supplied decreases
What would cause an increase in the supply of milk
An increase in the price of cattle feed
An increase in wages paid to farm workers
The introduction of a subsidy to cattle farmers
The outbreak of a disease affecting cows
Which of the following does NOT shift the supply curve?
a fall in the price of the product's joint supply
a technological advance
a decrease in the wages of labor used in production of the good
an increase in the price of the good
A shortage causes the
supply curve to shift rightward
price to rise
price to fall
demand curve to shift leftward
If the good in the above figure is a normal good and income rises, then the new equilibrium quantity
is less than 300 units
is more than 300 units
could be less than, equal to, or more than 300 units
is 300 units
At a price of $10 in the above figure, there is
a surplus of 400 units
a shortage of 200 units
a surplus of 200 units
a shortage of 400 units
At a price of $4 in the above figure,
there is a surplus of 200 units
the equilibrium quantity is 400 units
the quantity supplied is 400 units
there is a shortage of 200 units
If there are technological advances in the production of the good, then the new price for the good
is $6
is more than $6
could be less than, equal to, or more than $6
is less than $6
If there is a rise in the price of the resources used to produce the good, then the new price
is less than $6
is more than $6
could be less than, equal to, or more than $6
is $6
When the demand for a good decreases, its equilibrium price ________ and equilibrium quantity ________.
rises; decreases
falls; increases
falls; decreases
rises; increases
The price of a gallon of milk falls. Which of the following is a possible cause?
a drought that reduces supplies of feed grains fed to cows that produce milk
an increase in the income of the average household, with milk being a normal good
a discovery that milk cause diabetes
a decrease in the price of oatmeal, a complement to milk
Goods A and B are complementary goods (in consumption). The cost of a resource used in the production of A decreases. As a result,
the equilibrium price of B will fall and the equilibrium price of A will rise.
the equilibrium prices of both A and B will rise.
the equilibrium price of B will rise and the equilibrium price of A will fall.
the equilibrium prices of both A and B will fall.
If both demand and supply increase, what will be the effect on the equilibrium price and quantity?
The price will rise but the quantity could either increase, decrease, or remain the same
The quantity will increase but the price could either rise, fall, or remain the same
Both the price and the quantity will increase
The price will fall but the quantity will increase
An unusually warm winter
shifts the supply curve of gloves leftward
shifts the demand curve for gloves rightward
shifts the demand curve for gloves leftward.
shifts the supply curve of gloves rightward
Walkman Watch expects a recession to occur. Knowing that a Walkman is a normal good, you predict that the demand for a Walkman
will increase.
might increase or decrease
will decrease
will remain unchanged