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Price Mechanism Flashcards | StudBud

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Why do suppliers increase supply when consumers ration their demand?

what happens to market saturation when prices fall?

Price Mechanism

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price mechanism

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Questions 8

Answers

1
what happens to market saturation when prices fall?
it becomes more saturated
it becomes less saturated
2
Why do suppliers increase supply when consumers ration their demand?
Lower costs
More profit is potentially available
3
Which resources achieve high prices?
scarce
natural
unlimited
scare
4
What do consumers do when prices rise?
Demand more
Ration their demand
Signal their demand
Nothing
5
Which one is a scarce resource?
diamonds
Ugg Boots
loom bands
rocks
6
when do producers/suppliers leave the market?
when the pound is stronger
when prices rise
when prices fall and the market is saturated
when the pound is stronger
7
What does impact does rationing have on producers?
sends a signal that there is a scarcity or shortage
sends a signal that there's more demand
sends a signal to reduce supply
8
What are the 3 key functions of prices and profits?
Rationing, signalling, incentive
Supply, Signalling, Incentive
Rationing, Signalling, Shifting
Rationing, speculating, signalling