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Supply, Demand, & Price Review Flashcards | StudBud
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Supply, Demand, & Price Review
Supply, Demand, & Price Review
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StudBud Administration
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A review of basic concepts in supply, demand, and price #economics
Flashcards
22 cards
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Questions
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Answers
1
When prices increase and income remains the same, consumers feel as though they have less.
Substitute effect
Income effect
Elastic effect
Revenue effect
2
Firms will offer more of a product when prices increase, and less when prices decrease. This is
Law of Demand
Law of Price
Law of Elasticity
Law of Supply
3
Which is an example of a substitute for milk?
oil
orange juice
cereal
popcorn
4
Which is not an example of a normal good?
Store brand cereal
2020 Camaro
New jeans
iMac Laptop
5
Consumers are more inclined to buy normal goods when...
they are given a government excise tax
their income increases
their income decreases
their income stays the same
6
Which is an example of a complement of milk?
orange juice
oil
cereal
popcorn
7
When prices are high, firms will...
lower the prices to get rid of their inventory
supply more of the product to increase revenue
stop producing the product
supply less of the product to encourage buyers
8
Advancements in technology usually affect production by...
innovating production
Increasing production cost
reducing physical capital
Lowering production cost
9
When supply of a product does not match the demand there is a
surplus
shortage
disequilibrium
equilibrium
10
__________ determines elasticity of supply
factors of production
labor
time
money
11
The change in production by adding an additional unit of labor is called...
Margarine
Thinking on the Margin
Marginal Product of Cost
Marginal Product of Labor
12
Economists use demand curves to....
Determine how much of a good or service to supply
establish price ceilings
Demographics of that population
Who will buy a good or service
13
The amount of a product that consumers will purchase at a certain price is...
Demand
Shock Supply
Total Revenue
Supply Schedule
14
An example of a fixed cost would be...
rent paid for using a building
wages paid to workers
food cost for a restaurant
electricity bills
15
supply<demand=
disequilibrium
surplus
equilibrium
shortage
16
supply>demand=
disequilibrium
surplus
shortage
equilibrium
17
The most evident example of a price floor in a free market economy...
production costs
subsidies
excise taxes
minimum wage
18
Law of supply, law of demand, price floors, etc. do not affect...
a black market
a free market system
a traditional economy
a command economy
19
Marginal Product of Labor can decrease production if...
Workers don't get along
Wages for workers increase
Workers are specializing
Too many workers with not enough to do
20
Demand of a good or service is inelastic if...
the demand does not change
firms stop producing the good or service
the demand can increase or decrease
firms increase the price of the good or service
21
If prices are raised on inelastic goods...
Total revenue will decrease
IDK
Total revenue will increase
Total revenue stays the same
22
Factors that can change the quantity supplied are called...
Variables
Subsidies
Taxes
Fixed cost
