How Markets Work

A car company is opening a new factory. Which of the following is one of its start-up costs?

Which of the following describes both the substitution effect and the income effect?

Selling a good below cost to drive competitors out of the market

When many companies sell goods that are similar but not exactly the same

Removing government controls is called:

New machines allows a factory to make pencils faster & cheaper -- what will happen as a result?

People feel poorer when prices for goods increase

When two companies join to make one company

Cost that changes from month to month

Which of the following is the best example of what happens when equilibrium is reached?

What stays the same when you change an individual demand schedule into a market demand schedule

Which of the following causes excess demand?

What state does a free market move toward naturally?

The amount of goods a firm has on hand

How buyers and sellers communicate

Which is a real-life example of a market that is close to perfect competition?

When too few competitors produce a product

Which traffic signal best shows what an SUV manufacturer should do when SUV prices go down?

When the marginal product decreases as the number of workers increases

Charging different prices to different consumers

Chart that tells how much an individual supplier will offer at different prices

Good that is the same no matter who sells it

How does an increase in an excise tax on cars affect the supply of cars?

The desire to own something and the ability to pay for it is called:

A list of the quantity of a good that a person will buy at different prices

Graph of quantity supplied at different prices

Fixed costs plus variable costs

All the money that a company earns by selling goods or services

When quantity demanded equals quantity supplied

How are prices & output in a monopoly different from the prices & output in perfect competition

A good that consumers demand less of when their incomes increase

What do businesses learn by multiplying the price they charge for a good by the quantity sold?

Which of the following is most likely to create a black market?

When a change in price does not affect demand very much

Which is a fixed cost?

Two goods that are bought and used together

Government payment that helps a business

When producers make more as price increases and less as price falls

When a few large firms control a market

The smallest amount that can be paid to a worker for one hour of labor