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Get faster at matching terms Chapter 3 Terms in this set (45)A market is any arrangement that brings together the buyers and sellers of a particular good or service. True Demand is the amount of a good or service that a buyer will purchase at a particular price. False The law of demand states that as price increases, other things being equal, the quantity of the product False The law of diminishing marginal utility is one explanation of why there is an inverse relationship between price and quantity demanded. True The substitution effect suggests that, at a lower price, you have the incentive to substitute the more expensive product for similar products that are relatively less expensive. False There is no difference between individual demand schedules and the market demand schedule for a product. False In graphing supply and demand schedules, supply is put on the horizontal axis and demand on the vertical axis. False If price falls, there will be an increase in demand. False If consumer tastes or preferences for a product decrease, the demand for the product will tend to decrease. True An increase in income will tend to increase the demand for a product. True When two products are substitute goods, the price of one and the demand for the other will tend to move in the same direction. True If two goods are complementary, an increase in the price of one will tend to increase the demand for the other. False A change in the quantity demanded means that there False Supply is a schedule that shows the amounts of a product a producer can make in a limited time period. False An increase in resource prices will tend to decrease supply. True A government subsidy for the production of a product will tend to decrease supply. False An increase in the prices of other goods that could be made by producers will tend to decrease the supply of the current good that the producer is making. True A change in supply means that there is a movement along an existing supply curve. False A surplus indicates that the quantity demanded is less True If the market price of a product is below its equilibrium False The rationing function of prices is the elimination of shortages and surpluses. True Allocative efficiency means that goods and services are being produced by society in the least costly way. False If the supply of a product increases and demand decreases, the equilibrium price and quantity will increase. False If the demand for a product increases and the supply of the product decreases, the equilibrium price will increase and equilibrium quantity will be indeterminate. True A price ceiling set by government below the competitive market price of a product will result in a surplus. False A schedule that shows the various amounts of a product consumers are willing and able to purchase at each price in a series of possible prices during a specified period of time is called
(b) demand The reason for the law of demand can best be explained in terms of (d) diminishing marginal utility Assume that the
price of video game players falls. What (d) Price will increase; quantity will increase. Which
change will decrease the demand for a product? (d) a decrease in the number of buyers The income of a consumer decreases and the consumer's demand for a particular good increases. It can be (a) normal Which of the following could cause a decrease in (b) an increase in the prices of goods that are good If two goods are substitutes for each other, an increase (b) increase the demand for the other If two products, A and B, are complements, then (a) an increase in the price of A will decrease the demand for B If two products, X and Y, are independent goods, then (c) an increase in the price of Y will have no significant effect on the demand for X The law of supply states that, other things being constant, as price increases (c) quantity supplied increases A decrease in the supply of a product would most likely be
caused by (a) an increase in business taxes if the quantity supplied of a product is greater than (b) there is a surplus of the product If the price of a product is below the equilibrium price, (b) a shortage of the good Which would be the best example of allocative efficiency? When society devoted resources to the production (c) computers with word processors instead of typewriters A decrease in supply and a decrease in demand will (d) affect price in an indeterminate way and decrease the quantity exchanged A decrease in supply and a decrease in demand will (c) increase price and affect the quantity exchanged in an indeterminate way An increase in demand and a decrease in supply will (d) decrease price and the effect upon quantity exchanged will be indeterminate An increase in supply and an increase in demand will (d) affect price in an indeterminate way and increase the quantity exchanged A cold spell in Florida devastates the orange crop. (b) The supply of Florida oranges decreases causing their price to increase and the demand for California oranges to increase. 28. A maximum price set by the government that is
designed to help consumers is a (a) price ceiling Recommended textbook solutions Principles of Microeconomics7th EditionN. Gregory Mankiw 830 solutions Principles of Microeconomics8th EditionN. Gregory Mankiw 796 solutions Principles Of Microeconomics7th EditionN. Gregory Mankiw 830 solutions Economics4th EditionJ. Holton Wilson, J.R. Clark 890 solutions Sets with similar termsMacroeconomics Chapter 3 Multiple Choice19 terms laurenkwilhelm Macroeconomics Chapter 354 terms mjoumas1 Econ 121 255 terms Gorgeous-Rex Sets found in the same folderECON 201 Chapter 3 & 421 terms moses_mosesXD Econ ch 355 terms kmp5 Econ Chapter 1 - 3: Practice Test30 terms JillianWoodard Small Test - Economics EOC (GSE) UPDATED Domain:…125 terms joshua_jihoon_park Other sets by this creatorStock Patterns159 terms jwohlin2PLUS Map quiz43 terms jwohlin2PLUS business law important terms160 terms jwohlin2PLUS Business law terms205 terms jwohlin2PLUS Verified questions
ECONOMICS The percentage of people in a particular group who live in households below the official poverty threshold _____ Verified answer
ECONOMICS The recent college graduates who created Instragram, a free photo-sharing application for smartphones, did so because they saw a need for people quickly to upload and share their photos online. Within two years they sold Instagram to Facebook for a billion dollars. Would you say that they were exhibiting entrepreneurship? Explain your answer. Verified answer ECONOMICS What two programs are financed by FICA? Refer to your completed cluster diagram. Verified answer
ECONOMICS You are organizing a lemonade stand for a club's fund-raising event. You have recruited volunteers to work the booth. The club will provide: tables, tablecloths, and two large signs. You have paid $150 to rent the space for your booth. You have ordered 1,000 lemons for$200--enough for 1,000 cups of lemonade, which will sell for $1.00 per cup. The vendor can deliver more as you need them, but you can't return those you've already accepted. You have purchased 2,000 paper cups for$100. Miscellaneous items cost an additional $100. a. What are the variable costs in this enterprise? The fixed costs? b. What will be your break-even point if you do not order additional lemons? c. At what point will you maximize profits? d. How does this fund-raising event differ from a for-profit business? Verified answer Other Quizlet setsMacro Chapter 3 Quiz Study Guide T/F24 terms SVC_2021 Macroeconomics Quiz 225 terms brianna_scott9 Demand17 terms Daniel_Dow3PLUS Macro quiz 235 terms jessica_pendrick Related questionsQUESTION Suppose an individual is allocating income over two goods such that MUx/Px < MUy/Py. The consumer can increase total utility by purchasing: 13 answers QUESTION Joe's Garage operates in a perfectly competitive market. At the point where marginal cost equals marginal revenue, ATC = $20, AVC = $15, and the price per unit is $10. In this situation, 15 answers QUESTION 37) In a perfectly competitive market, a permanent increase in demand initially brings a higher price, economic 3 answers QUESTION a firm is producing 1000 units at a total cost of $5000. If it were to increase production to 1001 units, its total cost would rise to $5008. What does this information tell you about the firm? 5 answers What happens when the price of a product increases?An increase in price almost always leads to an increase in the quantity supplied of that good or service, while a decrease in price will decrease the quantity supplied.
When the price of a product increases a consumer?When the price of a product increases, a consumer is able to buy less of it with a given money income. This describes the: income effect.
What happens when consumers react to an increase in a goods price?The substitution effect occurs when consumers react to an increase in a good's price by consuming less of that good and more of other goods.
What causes the price of a product to increase in a market?a. Excess demand will cause the price to rise, and as price rises producers are willing to sell more, thereby increasing output.
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As the price of a product increases the amount of the product that consumers purchase increases
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