Demand & Supply

A decrease in the price of a good will

• increase supply.
• decrease supply.
• increase quantity supplied.
• decrease quantity supplied.

The movement from Point A to Point B represents a(n)

• increase in the price.
• decrease in the quantity supplied.
• shift in the supply curve.
• Both Orange and Blue are correct.

Which of the following would not shift the supply curve for iphones?

• an increase in the price of iphones
• a decrease in the number of sellers of iphone
• an increase in the price of plastic, an input into the production of iphones
• an improvement in the technology used to produce iphones

The law of supply and demand asserts that

• demand curves and supply curves tend to shift to the right as time goes by.
• when the supply curve for a good shifts, the demand curve for that good shifts in response.
• the price of a good will eventually rise in response to an excess demand for that good.
• the equilibrium price of a good will be rising more often than it will be falling.

Thousands of people leave a small town due to a factory closing down. Sales at the local grocery store are reduced. What causes this change?

• Prices or availability of substitutes

• Prices or availability of complementary goods

• Change in the weather or season

• Change in the number of buyers

New technology advances the rate at which furniture can be assembled. Why does this change the supply?

• There is a change in cost of production.

• The number of producers changes.

• The expectations of consumers changes.

• The output rate declines.

Refer to Graph 4-1. The movement from point A to point B on the graph shows

• a decrease in demand.

• an increase in demand.

• an increase in quantity demanded.

• a decrease in quantity demanded.

When the price of gasoline increases, Jerome starts to carpool is order to use less gasoline. This is a good example of the:

• Substitution Effect

• Reflection Effect

• Surplus Effect

• Income Effect

What is demand?

• Willingness to buy a specific good and services for a given price

• Willingness to sell a specific good and services for a given price

• An increase in the price, a decrease in the quantity demanded

• An increase in the price causes an increase in the quantity demanded.

What is supply?

• Willingness to buy a specific good and services for a given price

• Willingness to sell a specific good and services for a given price

• An increase in the price, a decrease in the quantity supplied

• An increase in the price causes an increase in the quantity supplied