Canvas Ch 3 B

Price elasticity of supply measures how responsive consumers are to a change in price.

A binding price floor occurs when a price is _____________ than equilibrium price.

A price floor occurs when the price is higher than equilibrium and quantity supplied is ______ than quantity demanded.

Product X is a normal good. With increased income, what happens demand, price and quantity for product X?

Factors that determine elasticity of demand include which of the following?

When there is a technological improvement in the cell phone market, at every price producers will produce ________.

An equilibrium price in a market is where quantity demanded equals quantity supplied.

When consumer income increases, the supply curve for a normal product will shift to the right.

If a shortage in a market occurs, price in the market will rise.

If a 5% change in the price of a product causes a greater than 5% change in quantity demanded, the demand is _________.

When a surplus occurs, as the price moves toward equilibrium, what happens to quantity demanded and quantity supplied?

A shortage exists in a market when the price is ________.

When quantity demanded exceeds quantity supplied the market is in ________.

When the price of tennis rackets increases, what happens in the market for tennis balls?

Price floors create surpluses where quantity supplied exceeds quantity demanded.