Economics Flashcard

Front

A market is in equilibrium when

Back

quantity supplied and quantity demanded are equal.

Front

Disequilibrium occurs when

Back

quantity supplied and quantity demanded are not equal.

Front

When there is excess supply,

Back

prices will tend to fall.

Front

Which statement explains why prices rise in a market? Options: Producers produce a quantity greater than consumers want to buy. Consumers buy much less of a good than they have in previous years. New producers enter the market. There is excess demand in the market.

Back

There is excess demand in the market.

Front

The minimum wage is an example of

Back

a price floor.

Front

When does a surplus exist?

Back

when there is a greater supply of a good than people want to buy

Front

Which of the following is an example of a shortage? Options: Stores cannot sell all the new popular toys they have on hand. Manufacturers make too many units of a popular new toy. Consumers cannot find enough of a popular new toy in stores. Consumers cannot afford to buy a new popular toy.

Back

Consumers cannot find enough of a popular new toy in stores.

Front

How are goods and resources distributed in a free market economy?

Back

through prices

Front

Rationing is a common form of distribution in

Back

a centrally planned economy.

Front

Which of the following is an example of spillover costs? People buy products by paying illegally high prices for them., There is a sudden shortage of goods and the supply cannot be increased quickly., People have to pay higher prices for items that are in short supply., A manufacturer pollutes a river and does not pay the costs for cleaning it.

Back

A manufacturer pollutes a river and does not pay the costs for cleaning it.