ECO101H1 Lecture Notes - Lecture 5: United States
ECO101H1 Full Course Notes
Related textbook solutions
: Do the following cause a change in demand (shift in demand curve), change in supply (shift in supply curve), change in quantity demanded (movement along demand curve) or change in quantity supplied (movement along supply curve)?
1) The market for Aquafina water. The price of Dasani increases.
2) The market for ground beef. The price of cow-feed increases
. 3) The market for hamburger patties. The price of hamburger buns decreases.
4) The market for pistols. Republicans fear that a democratic president will initiate new gun control laws making it more difficult to purchase guns.
1. In a competitive market, the quantity of a product produced and the price of the product are determined by
c. both buyers and sellers.
d. None of the above is correct.
2. Which of the following statements is correct?
a. Buyers determine supply and sellers determine demand.
b. Buyers determine demand and sellers determine supply.
c. Buyers determine both demand and supply
d. Sellers determine both demand and supply
3. The demand for a good or service is determined by
a. those who buy the good or service
b. the government.
c. those who sell the good or service.
d. both those who buy and those who sell the good or service.
4. An increase in supply is represented by
a. a movement downward and to the left along a supply curve.
b. a movement upward and to the right along a supply curve.
c. a rightward shift of a supply curve.
d. a leftward shift of a supply curve
1)The law of demand states that as the price of a good rise, _____.
A. buyers purchase more of the good because the price of a substitute has risen.
B. buyers purchase less of the good because their real income decreases with an increase in price.
C. buyers purchase more of the good because they expect prices to be even higher in the future
D. buyers purchase less of the good because they expect prices to fall in the future.
2) A movement along a demand curve can be attributed to a change in:
A. the quantity demanded of a good.
B. the demand for a good.
C. the substitution effect of consuming a good.
D. the opportunity cost of producing a good.
3) If we say that demand for a good has increased, we mean that there has been:
A. a leftward shift of the demand curve.
B. a rightward shift of the demand curve.
C. a leftward movement along the demand curve.
D. a rightward movement along the demand curve.
4) Which of the following will cause the demand curve for a normal good to shift to the right?
A. An increase in the price of a complementary good.
B. A decrease in income.
C. A decrease in the price of the good.
D. An increase in the price of a substitute good.
5)Which of the following best defines supply?
A. The amount of a good that is produced at the least possible cost, other things constant
B. The amount of a good that producers are willing and able to sell at each possible price, other things constant.
C. The amount of a good that consumers want to buy at different income levels
D. The amount of a good that producers want to sell at a fixed price
6)The market supply curve of a particular product indicates the total quantities:
A. that are actually sold during a given time period.
B. that sellers are willing to offer for sale at a fixed price.
C. that buyers are willing to purchase at alternative prices.
D. that sellers are willing and able to offer at alternative prices.
7)When quantity demanded of a good exceeds the quantity supplied at the prevailing market price, _____.
A. the demand curve shifts rightward until the surplus is eliminated
B. the market is in equilibrium.
C. the price of the good will tend to increase.
D. the price of the good will decrease
8)A shortage of textbooks is most likely to cause:
A. an increase in the price of textbooks.
B. a decrease in the supply of textbooks.
C. a decrease in the price of paper.
D. an increase in the cost of printing.
9)The most important characteristic of the equilibrium price is that it:
A. maximizes the quantity demanded.
B. clears the market, leaving neither a surplus nor a shortage.
C. minimizes the quantity demanded.
D. guarantees that producers earn the profit.
10)If both demand and supply increases in a market that is initially in equilibrium, the price will:
A. increase only if demand increases more than supply.
B. increase only if supply increases more than demand.
C. remain unchanged while quantity will increase.
D. remain unchanged while quantity will decrease.