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Chapter 2 - Supply & Demand Flashcards | StudBud
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Chapter 2 - Supply & Demand
Chapter 2 - Supply & Demand
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1
Beer and chicken are
Tonights dinner
Complementary goods
Substitutes
Joint supply
2
When there is disequilibrium, government intervention is required to prevent a situation of excess supply or demand
True
False
3
Which option is most likely to result in a movement along the demand curve for hybrid (energy efficient) cars?
A rise in consumer income levels
A successful advertising campaign that promotes energy efficient travel
The imposition of a sales tax on all motor vehicles
A rise in the price of petrol (gasoline) cars
4
The difference between what consumers are willing and able to pay for a product and the actual price paid for it is
producer surplus
consumption shortage
consumer excess
consumer surplus
5
Only at equilibrium is the following achieved
Productive efficiency
Maximum social surplus
Allocative efficiency
All of the above
6
Which of the following factors would cause the shift in supply of beef shown below?
An increase in the price of butter
An increase in the price of lamb
A decrease in the price of leather
A decrease in the price of milk
7
Which of the following factors would NOT cause a change in demand for a product?
Changing consumer habits and tastes
The price of complementary goods
Technological progress
Income
8
Butter and low fat milk is an example of competitive supply
True
False
9
Which factor is not a determinant of demand?
Income
Number of producers
Price of complements
Tastes and preferences
10
Ceteris paribus, an increase in supply will result in
A decrease in price and quantity sold
A decrease in price and increase in quantity sold
An increase in price and decrease in quantity sold
An increase in price and quantity sold
11
When the demand for a product decreases with rising income, it is called and abnormal good.
True
False
12
Which of the following scenarios best describes the shift shown below?
The market for motor vehicles following a period of higher fuel prices
The market for bicycles after a fall in vehicle prices
The market for electric vehicles after a subsidy is given by the government
The market for public transport following a period of rising fuel prices
13
Which of the following would cause the shift in the diagram below?
Tighter immigration laws
Decrease in the price of a substitute
Increase in income (inferior good)
Decrease in income tax (normal good)
