MGEA01H3 Chapter Notes - Chapter 3: Economic Equilibrium, Demand Curve, Inferior Good

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pearseal162

16 Sep 2016

School

UTSC

Department

Economics for Management Studies

Course

MGEA01H3

Professor

Michael H O

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MGEA01H3 Full Course Notes

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Mgea01 chapter 3 supply & demand: a model of a competitive market. In the case of a shortage or surplus, how price moves the market back to equilibrium. Competitive market: a market in which there are many buyers and sellers of the same good or service, none of whom can influence the price at which the good or service is sold. Supply and demand model: is a model of how a competitive market behaves/works. Supply curve: demand and supply curve shifts, market equilibrium, changes in the market equilibrium. Demand schedule: shows how much of a good or service consumers will want to buy at different prices. Quantity demanded: the actual amount of a good or service consumers are willing and able to buy at some specific price. Demand curve: the graphical representation of the demand schedule. It shows how much of a good or service consumers want to buy at any given price.

Related Questions

1. In a competitive market, the quantity of a product produced and the price of the product are determined by

a. buyers.

b. sellers.

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

ceruleanseal203

The market demand curve

a. slopes upward.

b. is found by vertically adding the individual demand curves.

c. represents the sum of the quantities demanded by all the buyers at each price of the good.

d. represents the sum of the prices that all the buyers are willing to pay for a given quantity of the good.

When we move along a given demand curve,

all nonprice determinants of demand are held constant.

only price is held constant.

all determinants of quantity demanded are held constant.

d. income and price are held constant.

When the price of a good or service changes,

	a.	there is a movement along a given demand curve.
	b.	the demand curve shifts in the opposite direction.
	c.	the supply curve shifts in the opposite direction.
	d.	the demand curve shifts in the same direction.

7) Indicate whether each of the following statements is true or false, and explain why.

A. Producer surplus tends to fall as the supply curve becomes more elastic.

B. Consumer surplus tends to rise as demand becomes more elastic.

C. The market demand curve indicates the minimum price buyers are willing to pay at each level of production.

D. The market supply curve indicates the minimum price required by sellers as a group to bring forth production.

E. Consumer surplus is the amount that consumers are willing to pay for a given good or service above and beyond the amount actually paid.

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MGEA01H3 Chapter Notes - Chapter 3: Economic Equilibrium, Demand Curve, Inferior Good

MGEA01H3 Full Course Notes

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