Demand, supply and market equilibrium

Pam considers t-shirts and gym classes to be complementary goods.

How will Pam react if the price of gym classes increases?

• Her quantity demanded of gym classes will increase, and her demand for t-shirts will increase.

• Her quantity demanded of gym classes will decrease, and her demand for t-shirts will be unaffected.

• Her quantity demanded of gym classes will decrease, and her demand for t-shirts will decrease.

• Her quantity demanded of gym classes won’t change, and her demand for t-shirts will increase.

• Her quantity demanded of gym classes will increase, and her demand for t-shirts will decrease.

All of the following will result in a shift in a demand curve except:

• A change in the income of buyers

• A change in the supply of a good

• A change in expected future prices

• A change in the price of related goods

• A change in buyers' preferences

Economists have observed that when average incomes increase, purchases of fast food tends to decline.

Based on this information, what can we definitely say about fast food?

• Demand for fast food is upward sloping

• Fast food has no substitutes

• The price of a complement to fast food has risen

• Fast food is an inferior good

• Fast food is a normal good

Penny thinks that the price of books will decrease next week.

If everything else is equal, which of the following would reflect how Penny's behavior will change in response to her expectations?

• Penny will demand more complementary goods to books

• Penny's demand for books today will decrease

• Penny will move to a new, lower quantity along her demand curve

• Penny will move to a new, higher quantity on her demand curve

• Penny's demand for books today will increase

Land in the United States can be used to produce either soybeans or corn. The price of soybean fertilizer has fallen due to cheaper imports from China.

What will change for soybeans and corn?

• Supply of both corn and soybeans will increase

• Supply of soybeans will decrease and supply of corn will increase

• Supply of soybeans will increase and the supply of corn will decrease

• Quantity supplied of corn and quantity supplied of soybeans will both increase

• Quantity supplied of corn and quantity supplied of soybeans will both decrease

Coffee bean merchants notice that coffee prices are at a historic low today, but they expect the price of coffee beans to increase in the next six months.

How will the expectation of an increase in future prices most likely affect the supply of coffee beans on the market today?

• Supply will decrease

• Supply will increase

• There will be a movement along the same supply curve to a new higher quantity supplied

• There will be a movement along the same supply curve to a new lower quantity supplied

• No change in supply

According to the law of supply, what happens when the price of a good increases?

• The supply curve shifts to the left.

• The quantity supplied increases.

• People are willing to buy what is supplied.

• The supply curve flattens out.

• The supply curve shifts to the right.

Which of the following terms describes a situation in which there is an excess quantity supplied in a market?

• Shortage

• Efficiency

• Surplus

• Equilibrium

• Excess demand

Shampoo and conditioner are complementary goods.

What happens to the price and quantity of conditioner if the price of shampoo decreases?

• Price decreases; quantity increases.

• Price increases; quantity decreases.

• Price increases; quantity increases.

• Price decreases; quantity decreases.

• Price decreases; quantity demanded does not change.