What happens when we have a decrease in Supply?

Price goes up and quantity goes down

Which headline would create a decrease in demand?

Study shows orange juice causes disease

A market-equilibrium occurs when

Quantity demanded equals quantity supplied

What is the law of demand?

When goods are cheaper people want more

Which would be considered an example of a price ceiling

a maximum price of $4.00 for a gallon of gas

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Demand, Supply and Equilibrium review

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This is a supply and demand review for an introductory economics class.

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Questions 20

Answers

1
What will a seller do if there is a shortage of a product?
have a sale
keep the price the same
raise the price
lower the price
2
Which is not a supply shifter?
Change in the cost of production
Change in price of the product
Change in taxes
Change in technology
3
Which determinant is a factor in change in quantity demanded?
Income of the consumer
Price of related goods
all of the above
Price of the good
4
Peanut butter and Jelly are...
Substitutes
Delicious
Complements
5
If the price of good A increases the demand for substitute B will...
Increase
Stay the same
Who knows?
Decrease
6
What happens when we have a decrease in Supply?
Price goes up and quantity goes down
Price and quantity go down
Price goes down and quantity goes up
Price and quantity go up
7
The equilibrium price and quantity would be...
P = $5, Q= 4
P= $6, Q= 5
P=$5, Q=6
P= $5, Q=5
8
Which graph shows an increase in supply?
Graph D
Graph B
Graph C
Graph A
9
How are prices decided in a free market economy?
Guessing
Bargaining
Competition
Regulation
10
When we increase demand what happens to price and quantity?
Price and quantity go down
Price goes down and quantity goes up
Price goes up and quantity goes down
Price and quantity go up
11
The point where quantity demanded equals quantity supplied
Quantity Demanded
Equilibrium
Quantity Supplied
Entrepreneur
12
Which headline would create a decrease in demand?
Study shows orange juice causes disease
producers reducing supply of orange juice
government imposes heavy tax on production of orange juice
Number of orange juice drinkers increase greatly
13
A market-equilibrium occurs when
Assets equal liabilities
Shortages equal surpluses
Quantity demanded equals quantity supplied
Deficits equal surpluses
14
What will a price ceiling result in?
Sale
Shortage
Surplus
15
What is the law of demand?
When goods are cheaper people want more
Everyone has a limited income they spend
When the price of a good is lower businesses will sell less
Higher the price more people want it
16
The amount by which the quantity demanded is higher than the quantity supplied.
Shortage
Surplus
Boycott
Controlled quantity
17
Which would be considered an example of a price ceiling
a minimum wage of $7.25
$2 per gallon subsidy for milk producers
a maximum price of $4.00 for a gallon of gas
$1 per bushel subsidy for corn
18
Which way to we shift supply or demand to show an increase?
Up
Right
Down
Left
19
Which graph shows an increase in QUANTITY supplied?
Graph B
Graph D
Graph A
Graph C
20
When a Supply or Demand curve increase, the curve shifts to the
down
right
left
up

Demand, Supply and Equilibrium review Flashcards | StudBud